Private Bancorp of America (OTCMKTS:PBAM) versus First Foundation (NYSE:FFWM) Head-To-Head Analysis

First Foundation (NYSE:FFWM) and Private Bancorp of America (OTCMKTS:PBAM) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, analyst recommendations, valuation and dividends.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
First Foundation	-26.09%	-0.07%	-0.01%
Private Bancorp of America	24.04%	17.10%	1.66%

Risk & Volatility

First Foundation has a beta of 0.92, meaning that its stock price is 8% less volatile than the S&P 500. Comparatively, Private Bancorp of America has a beta of 0.1, meaning that its stock price is 90% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for First Foundation and Private Bancorp of America, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Foundation	1	1	0	2	2.75
Private Bancorp of America	0	1	1	1	3.00

Private Bancorp of America has a consensus price target of $74.00, indicating a potential upside of 29.26%. Given Private Bancorp of America’s stronger consensus rating and higher possible upside, analysts clearly believe Private Bancorp of America is more favorable than First Foundation.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Foundation	$545.12 million	0.95	-$92.41 million	($1.96)	-3.18
Private Bancorp of America	$161.24 million	2.03	$35.82 million	$7.04	8.13

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

Institutional and Insider Ownership

73.1% of First Foundation shares are held by institutional investors. Comparatively, 13.5% of Private Bancorp of America shares are held by institutional investors. 9.5% of First Foundation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Private Bancorp of America beats First Foundation on 10 of the 15 factors compared between the two stocks.

About First Foundation

First Foundation Inc., through its subsidiaries, provides personal banking, business banking, and private wealth management services in the United States. It operates through two segments, Banking and Wealth Management. The company offers a range of bank deposit products, including personal and business checking accounts, savings accounts, interest-bearing negotiable order of withdrawal accounts, money market accounts, and time certificate of deposits; and loan products consisting of multifamily and single family residential real estate loans, commercial real estate loans, and commercial term loans and line of credits, as well as consumer loans, such as personal installment loans and line of credits, and home equity line of credits. It also provides various specialized services comprising trust services, internet and mobile banking, remote deposit capture services, merchant credit card services, ATM cards, Visa debit cards, and business sweep accounts, as well as insurance brokerage services and equipment financing solutions. In addition, the company offers investment management and financial planning services; treasury management services; advisory and coordination services in the areas of estate planning, retirement planning, and charitable and business ownership issues; and financial, investment, and economic advisory and related services. Further, it provides support services, including the processing and transmission of financial and economic data for charitable organizations. The company operates through a network of 28 branch offices and 3 loan production offices in California, Nevada, Texas, and Hawaii. First Foundation Inc. was founded in 1985 and is headquartered in Dallas, Texas.

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.