Analyzing First Financial Bankshares (NASDAQ:FFIN) and Private Bancorp of America (OTCMKTS:PBAM)

Private Bancorp of America (OTCMKTS:PBAM) and First Financial Bankshares (NASDAQ:FFIN) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, institutional ownership and risk.

Volatility & Risk

Private Bancorp of America has a beta of 0.02, meaning that its share price is 98% less volatile than the S&P 500. Comparatively, First Financial Bankshares has a beta of 0.82, meaning that its share price is 18% less volatile than the S&P 500.

Profitability

This table compares Private Bancorp of America and First Financial Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Private Bancorp of America	24.01%	16.38%	1.66%
First Financial Bankshares	31.00%	14.20%	1.76%

Valuation & Earnings

This table compares Private Bancorp of America and First Financial Bankshares”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Private Bancorp of America	$172.31 million	2.44	$40.67 million	$7.20	10.21
First Financial Bankshares	$635.54 million	7.27	$253.58 million	$1.84	17.53

First Financial Bankshares has higher revenue and earnings than Private Bancorp of America. Private Bancorp of America is trading at a lower price-to-earnings ratio than First Financial Bankshares, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and price targets for Private Bancorp of America and First Financial Bankshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Private Bancorp of America	0	1	3	1	3.00
First Financial Bankshares	0	3	1	0	2.25

Private Bancorp of America currently has a consensus target price of $86.33, suggesting a potential upside of 17.44%. First Financial Bankshares has a consensus target price of $37.33, suggesting a potential upside of 15.73%. Given Private Bancorp of America’s stronger consensus rating and higher possible upside, equities analysts clearly believe Private Bancorp of America is more favorable than First Financial Bankshares.

Institutional & Insider Ownership

13.5% of Private Bancorp of America shares are owned by institutional investors. Comparatively, 69.8% of First Financial Bankshares shares are owned by institutional investors. 3.8% of First Financial Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

First Financial Bankshares beats Private Bancorp of America on 9 of the 15 factors compared between the two stocks.

About Private Bancorp of America

Private Bancorp of America, Inc. operates as the bank holding company for CalPrivate Bank that provides banking products and services to individuals and businesses in California. The company offers checking and savings, money market, certificate of deposit, sweep, zero balance, and individual retirement accounts; unsecured lines of credit, personal credit lines, and term loans; additional services, such as direct deposits, online banking, ATM and debit cards, credit cards, savings/line of credit overdraft protection, and safe deposit boxes; and certificate of deposit account registry services. It also provides treasury management, merchant card, bill pay, positive pay, e-statement, remote deposit capture, ACH origination, wire transfer, electronic payments and collections, electronic check acceptance, account reconciliation, cash vault, and gift and business credit cards, as well as funds management services. In addition, the company offers term credit facilities and loans, equipment and business expansion loans, working capital lines of credit, commercial real estate financing, construction financing, letters of credit, business start-up loans, loans for business acquisition and partner buyouts, owner-occupied commercial real estate loans, equipment, furniture and fixture, and other loans; and CDARS And ICS products. Further, it provides wealth management and legal services. The company has offices in La Jolla, San Diego, Coronado, Newport Beach, Beverly Hills, El Segundo, Temecula, Mission Valley, and Redlands. Private Bancorp of America, Inc. was founded in 2006 and is headquartered in La Jolla, California.

About First Financial Bankshares

First Financial Bankshares, Inc., through its subsidiaries, provides commercial banking products and services in Texas. The company offers checking, savings and time deposits; automated teller machines, drive-in, and night deposit services; safe deposit facilities, remote deposit capture, internet banking, mobile banking, payroll cards, funds transfer, and performing other customary commercial banking services; securities brokerage services; and trust and wealth management services, including wealth management, estates administration, oil and gas management, testamentary trusts, revocable and irrevocable trusts, and agency accounts. It also provides commercial and industrial, municipal, agricultural, construction and development, farm, residential, and consumer auto and non-auto, as well as non-owner occupied and owner occupied commercial real estate loans. In addition, the company offers advisory and specialized services related to asset management, investing, purchasing, advertising, public relations, and technology services. First Financial Bankshares, Inc. was founded in 1890 and is headquartered in Abilene, Texas.