MidSouth Bancorp (NYSE:MSL) and PacWest Bancorp (NASDAQ:PACW) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, dividends, earnings, risk, analyst recommendations, valuation and institutional ownership.
MidSouth Bancorp pays an annual dividend of $0.04 per share and has a dividend yield of 0.4%. PacWest Bancorp pays an annual dividend of $2.40 per share and has a dividend yield of 7.3%. MidSouth Bancorp pays out -14.8% of its earnings in the form of a dividend. PacWest Bancorp pays out 82.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. PacWest Bancorp has increased its dividend for 7 consecutive years. PacWest Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares MidSouth Bancorp and PacWest Bancorp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional & Insider Ownership
70.3% of MidSouth Bancorp shares are owned by institutional investors. Comparatively, 88.6% of PacWest Bancorp shares are owned by institutional investors. 12.8% of MidSouth Bancorp shares are owned by insiders. Comparatively, 1.0% of PacWest Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares MidSouth Bancorp and PacWest Bancorp’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|MidSouth Bancorp||$102.40 million||1.84||-$11.76 million||($0.27)||-41.96|
|PacWest Bancorp||$1.18 billion||3.40||$357.81 million||$2.92||11.30|
PacWest Bancorp has higher revenue and earnings than MidSouth Bancorp. MidSouth Bancorp is trading at a lower price-to-earnings ratio than PacWest Bancorp, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for MidSouth Bancorp and PacWest Bancorp, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
MidSouth Bancorp currently has a consensus price target of $15.00, indicating a potential upside of 32.39%. PacWest Bancorp has a consensus price target of $54.75, indicating a potential upside of 65.91%. Given PacWest Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe PacWest Bancorp is more favorable than MidSouth Bancorp.
Risk and Volatility
MidSouth Bancorp has a beta of 1.34, meaning that its stock price is 34% more volatile than the S&P 500. Comparatively, PacWest Bancorp has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500.
PacWest Bancorp beats MidSouth Bancorp on 15 of the 18 factors compared between the two stocks.
About MidSouth Bancorp
MidSouth Bancorp, Inc., a bank holding company, through its subsidiary MidSouth Bank, N.A., provides various community banking products and services to commercial and retail customers in the United States. The company offers various deposit products, including interest-bearing and noninterest-bearing checking accounts, money market, savings accounts, investment accounts, and NOW account deposits, as well as time deposits, such as certificates of deposits; and commercial and industrial, commercial real estate, and consumer loans, as well as other loans secured by real estate. It also provides cash management services; and electronic banking services comprising remote deposit capturing services, Internet banking, and debit and credit cards. As of February 27, 2018, the company had 48 offices located in Louisiana and Texas, as well as a network of approximately 55,000 surcharge-free ATMs. MidSouth Bancorp, Inc. was founded in 1984 and is headquartered in Lafayette, Louisiana.
About PacWest Bancorp
PacWest Bancorp operates as the holding company for Pacific Western Bank, a state chartered bank that provides commercial banking products and services. The company accepts demand, money market, and time deposits. It also provides real estate loans to professional developers and real estate investors for the acquisition, refinancing, and construction of commercial real estate properties; small business administration loans; asset-based loans for working capital needs; venture capital loans to support the start-up operations of entrepreneurial companies; and equipment-secured loans and leases. In addition, the company offers consumer loans comprising personal loans, auto loans, home equity lines of credit, revolving lines of credit, and other loans. Further, it provides international banking and multi-state deposit services; money market sweep products; investment advisory and asset management services; treasury and cash management services; telephone banking, and online and mobile banking services; and foreign exchange and ATM services. The company offers its products and services to small and mid-sized companies, entrepreneurial businesses and their venture capital, private equity investors, professionals, and other individuals. As of February 1, 2018, it had 76 full-service branches located throughout the state of California; and one branch in Durham, North Carolina. The company was formerly known as First Community Bancorp and changed its name to PacWest Bancorp in April 2008. PacWest Bancorp was founded in 1999 and is headquartered in Beverly Hills, California.
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