Live Oak Bancshares (NASDAQ:LOB) and Byline Bancorp (NYSE:BY) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, profitability, institutional ownership, earnings and valuation.

Analyst Recommendations

This is a summary of recent ratings and price targets for Live Oak Bancshares and Byline Bancorp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Live Oak Bancshares 0 1 1 0 2.50
Byline Bancorp 0 1 0 0 2.00

Live Oak Bancshares currently has a consensus price target of $16.50, indicating a potential downside of 0.72%. Byline Bancorp has a consensus price target of $20.00, indicating a potential upside of 6.44%. Given Byline Bancorp’s higher possible upside, analysts plainly believe Byline Bancorp is more favorable than Live Oak Bancshares.

Insider & Institutional Ownership

45.3% of Live Oak Bancshares shares are owned by institutional investors. Comparatively, 29.4% of Byline Bancorp shares are owned by institutional investors. 25.9% of Live Oak Bancshares shares are owned by insiders. Comparatively, 39.2% of Byline Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Live Oak Bancshares and Byline Bancorp’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Live Oak Bancshares $266.41 million 2.51 $51.45 million $1.32 12.59
Byline Bancorp $258.59 million 2.76 $41.19 million $1.18 15.92

Live Oak Bancshares has higher revenue and earnings than Byline Bancorp. Live Oak Bancshares is trading at a lower price-to-earnings ratio than Byline Bancorp, indicating that it is currently the more affordable of the two stocks.

Dividends

Live Oak Bancshares pays an annual dividend of $0.12 per share and has a dividend yield of 0.7%. Byline Bancorp does not pay a dividend. Live Oak Bancshares pays out 9.1% of its earnings in the form of a dividend. Live Oak Bancshares has raised its dividend for 3 consecutive years.

Volatility & Risk

Live Oak Bancshares has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.Comparatively, Byline Bancorp has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.

Profitability

This table compares Live Oak Bancshares and Byline Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Live Oak Bancshares 15.69% 9.15% 1.21%
Byline Bancorp 16.67% 8.97% 1.15%

Summary

Live Oak Bancshares beats Byline Bancorp on 10 of the 17 factors compared between the two stocks.

About Live Oak Bancshares

Live Oak Bancshares, Inc. operates as the bank holding company for Live Oak Banking Company that provides various commercial banking products and services to individuals, small businesses, and professionals in North Carolina, the United States. The company accepts various deposit products, including noninterest-bearing demand, interest-bearing checking, money market, savings, and time deposits. It also offers commercial and industrial loans; construction and development loans; owner occupied and non-owner occupied collateral commercial real estate loans; and commercial land loans. In addition, the company provides settlement, accounting, and securitization services for government guaranteed loans; and wealth and investment management services to high-net-worth individuals and families. Live Oak Bancshares, Inc. was founded in 2008 and is headquartered in Wilmington, North Carolina.

About Byline Bancorp

Byline Bancorp, Inc. operates as the bank holding company for Byline Bank that provides a range of banking products and services to small and medium sized businesses, commercial real estate and financial sponsors, and consumers in the United States. It offers non-interest bearing accounts, money market demand accounts, savings accounts, interest bearing checking accounts, and time deposits, as well as certificates of deposit. The company also provides commercial loan products and services, including term loans, revolving lines of credit, construction financing, and cash management products; small business administration loans; and small ticket equipment leasing services, as well as online, mobile, and direct banking services. It operates through 57 branch offices in Chicago metropolitan area; and 1 branch office in Brookfield, Wisconsin. The company was formerly known as Metropolitan Bank Group, Inc. and changed its name to Byline Bancorp, Inc. in 2015. Byline Bancorp, Inc. was incorporated in 1978 and is headquartered in Chicago, Illinois.

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