Contrasting Associated Banc-Corp (ASB) and Live Oak Bancshares (LOB)
Live Oak Bancshares (NASDAQ: LOB) and Associated Banc-Corp (NYSE:ASB) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, valuation, analyst recommendations, dividends and profitability.
Earnings and Valuation
This table compares Live Oak Bancshares and Associated Banc-Corp’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Live Oak Bancshares||$151.53 million||4.33||$21.01 million||$0.70||31.21|
|Associated Banc-Corp||$1.02 billion||3.32||$210.79 million||$1.39||16.08|
Associated Banc-Corp has higher revenue and earnings than Live Oak Bancshares. Associated Banc-Corp is trading at a lower price-to-earnings ratio than Live Oak Bancshares, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
37.8% of Live Oak Bancshares shares are owned by institutional investors. Comparatively, 77.5% of Associated Banc-Corp shares are owned by institutional investors. 30.1% of Live Oak Bancshares shares are owned by company insiders. Comparatively, 1.8% of Associated Banc-Corp shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Risk and Volatility
Live Oak Bancshares has a beta of -0.11, meaning that its share price is 111% less volatile than the S&P 500. Comparatively, Associated Banc-Corp has a beta of 1.17, meaning that its share price is 17% more volatile than the S&P 500.
This table compares Live Oak Bancshares and Associated Banc-Corp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Live Oak Bancshares||13.71%||11.50%||1.37%|
This is a summary of current ratings for Live Oak Bancshares and Associated Banc-Corp, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Live Oak Bancshares||0||0||1||0||3.00|
Live Oak Bancshares currently has a consensus target price of $24.00, suggesting a potential upside of 9.84%. Associated Banc-Corp has a consensus target price of $25.00, suggesting a potential upside of 11.86%. Given Associated Banc-Corp’s higher probable upside, analysts clearly believe Associated Banc-Corp is more favorable than Live Oak Bancshares.
Live Oak Bancshares pays an annual dividend of $0.12 per share and has a dividend yield of 0.5%. Associated Banc-Corp pays an annual dividend of $0.48 per share and has a dividend yield of 2.1%. Live Oak Bancshares pays out 17.1% of its earnings in the form of a dividend. Associated Banc-Corp pays out 34.5% 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.
Associated Banc-Corp beats Live Oak Bancshares on 9 of the 16 factors compared between the two stocks.
About Live Oak Bancshares
Live Oak Bancshares, Inc. is a bank holding company. The Company conducts business operations primarily through its commercial bank subsidiary, Live Oak Banking Company (the Bank). The Bank specializes in providing lending services to small businesses nationwide in targeted industries. The loans originated by the Bank are guaranteed by the small business administration (SBA). The Company’s loan portfolio includes commercial and industrial loans; construction and development loans; commercial real estate, and commercial land. The Company’s investment securities include the United States Government agencies, residential mortgage-backed securities and mutual fund. The Company’s deposits include non-interest-bearing deposits and interest-bearing deposits, such as interest-bearing checking, money market and time deposits.
About Associated Banc-Corp
Associated Banc-Corp is a bank holding company. The Company, through its banking subsidiary Associated Bank, National Association (the Bank) and various nonbanking subsidiaries, provides a range of banking and non-banking products and services to individuals. The Company operates through three segments: Corporate and Commercial Specialty; Community, Consumer, and Business, and Risk Management and Shared Services. The Corporate and Commercial Specialty segment consists of lending and deposit solutions to businesses, developers, not-for-profits, municipalities and financial institutions. The Corporate and Commercial Specialty segment consists of lending and deposit solutions to businesses, developers, not-for-profits, municipalities and financial institutions. The Risk Management and Shared Services segment includes Corporate Risk Management, Credit Administration, Finance, Treasury, Operations and Technology, which are shared functions.
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