Head to Head Analysis: Webster Financial (NYSE:WBS) & CBB Bancorp (OTCMKTS:CBBI)

Webster Financial (NYSE:WBS) and CBB Bancorp (OTCMKTS:CBBI) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, analyst recommendations, valuation, dividends, risk, profitability and institutional ownership.

Profitability

This table compares Webster Financial and CBB Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Webster Financial	18.80%	11.03%	1.23%
CBB Bancorp	19.24%	N/A	N/A

Volatility and Risk

Webster Financial has a beta of 1.26, suggesting that its share price is 26% more volatile than the S&P 500. Comparatively, CBB Bancorp has a beta of 0.55, suggesting that its share price is 45% less volatile than the S&P 500.

Insider & Institutional Ownership

85.6% of Webster Financial shares are held by institutional investors. 0.9% of Webster Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Webster Financial and CBB Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Webster Financial	$3.94 billion	2.17	$867.84 million	$4.41	11.29
CBB Bancorp	$122.26 million	0.90	$28.86 million	$2.24	4.62

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

Analyst Recommendations

This is a breakdown of recent ratings for Webster Financial and CBB Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Webster Financial	0	3	9	0	2.75
CBB Bancorp	0	0	0	0	N/A

Webster Financial presently has a consensus target price of $57.85, indicating a potential upside of 14.55%. Given Webster Financial’s higher possible upside, research analysts clearly believe Webster Financial is more favorable than CBB Bancorp.

Dividends

Webster Financial pays an annual dividend of $1.60 per share and has a dividend yield of 3.2%. CBB Bancorp pays an annual dividend of $0.32 per share and has a dividend yield of 3.1%. Webster Financial pays out 36.3% of its earnings in the form of a dividend. CBB Bancorp pays out 14.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Summary

Webster Financial beats CBB Bancorp on 13 of the 15 factors compared between the two stocks.

About Webster Financial

Webster Financial Corporation operates as the bank holding company for Webster Bank, National Association that provides a range of financial products and services to individuals, families, and businesses in the United States. It operates through three segments: Commercial Banking, HSA Bank, and Consumer Banking. The Commercial Banking segment offers commercial real estate and equipment financing, business banking, asset-based lending, and commercial services; public sector finance; mortgage warehouse financing; sponsor and specialty financing services; credit, deposit, and cash flow management services; and wealth management solutions to business owners and operators, including trust, asset management, financial planning, insurance, retirement, and investment products, as well as treasury management services comprising derivative, treasury, accounts payable, accounts receivable, and trade products and services. This segment also provides commercial services, such as accounts receivable factoring and trade financing, payroll funding, and business process outsourcing. The HSA Bank segment offers health savings accounts, health reimbursement arrangements, flexible spending accounts, and commuter benefit services that are distributed directly to employers and individual consumers, as well as through national and regional insurance carriers, benefit consultants, and financial advisors. The Consumer Banking segment provides consumer deposit and fee-based services, residential mortgages, home equity lines, secured and unsecured loans, and credit cards to consumers; and small business banking products, such as credit, deposit, and cash flow management products to businesses and professional service firms. The company offers online and mobile banking services. Webster Financial Corporation was founded in 1935 and is headquartered in Stamford, Connecticut.

About CBB Bancorp

CBB Bancorp, Inc. operates as the holding company for Commonwealth Business Bank that provides various commercial banking products and services to individuals and businesses in the United States. It offers checking, savings, money market, and certification of deposit accounts; SBA lending; business lines of credit; business term loans; business and commercial property loans; construction loans; and credit cards. The company also provides treasury management, and mobile and online banking services, as well as title and escrow services. In addition, it engages in investing activities; and offers trade finance services, including commercial letters of credit, standby letters of credit, and documentary collection services. The company offers its services through full-service and limited-service branches in Southern California, Dallas, Texas and Honolulu, and Hawaii; and loan production offices in the states of Colorado, Georgia, Texas, and Washington. CBB Bancorp, Inc. was founded in 2005 and is headquartered in Los Angeles, California.