Analyzing Heritage Oaks Bancorp (NASDAQ:HEOP) and Its Peers

Heritage Oaks Bancorp (NASDAQ: HEOP) is one of 200 publicly-traded companies in the “Commercial Banks” industry, but how does it contrast to its competitors? We will compare Heritage Oaks Bancorp to similar companies based on the strength of its earnings, profitability, institutional ownership, analyst recommendations, dividends, valuation and risk.

Insider & Institutional Ownership

63.1% of Heritage Oaks Bancorp shares are owned by institutional investors. Comparatively, 47.0% of shares of all “Commercial Banks” companies are owned by institutional investors. 31.3% of Heritage Oaks Bancorp shares are owned by insiders. Comparatively, 11.7% of shares of all “Commercial Banks” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings for Heritage Oaks Bancorp and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Heritage Oaks Bancorp 0 1 2 0 2.67
Heritage Oaks Bancorp Competitors 379 2917 2349 68 2.37

Heritage Oaks Bancorp currently has a consensus price target of $12.50, indicating a potential downside of 6.37%. As a group, “Commercial Banks” companies have a potential upside of 4.47%. Given Heritage Oaks Bancorp’s competitors higher possible upside, analysts clearly believe Heritage Oaks Bancorp has less favorable growth aspects than its competitors.

Valuation & Earnings

This table compares Heritage Oaks Bancorp and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Heritage Oaks Bancorp N/A N/A 26.70
Heritage Oaks Bancorp Competitors $338.81 million $71.86 million 21.32

Heritage Oaks Bancorp’s competitors have higher revenue and earnings than Heritage Oaks Bancorp. Heritage Oaks Bancorp is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Dividends

Heritage Oaks Bancorp pays an annual dividend of $0.24 per share and has a dividend yield of 1.8%. Heritage Oaks Bancorp pays out 48.0% of its earnings in the form of a dividend. As a group, “Commercial Banks” companies pay a dividend yield of 1.9% and pay out 35.4% of their earnings in the form of a dividend. Heritage Oaks Bancorp lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Profitability

This table compares Heritage Oaks Bancorp and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Heritage Oaks Bancorp 22.37% 8.53% 0.91%
Heritage Oaks Bancorp Competitors 20.38% 8.68% 0.92%

Summary

Heritage Oaks Bancorp competitors beat Heritage Oaks Bancorp on 7 of the 12 factors compared.

About Heritage Oaks Bancorp

Heritage Oaks Bancorp is a bank holding company for Heritage Oaks Bank (the Bank). The Bank is a community-oriented financial services company that provides banking products and services to small and medium sized businesses and consumers. As of December 31, 2016, its products and services were offered primarily through 12 retail branches located on the Central Coast of California, in San Luis Obispo and Santa Barbara Counties and through other direct channels, including a loan production office in Ventura County. The Bank offers to its commercial clients commercial loans secured by real estate, other commercial loans and lines of credit, agricultural loans, construction financing, other real estate loans and small business administration loans. Its deposit products offered include personal and business checking and savings accounts, time deposit accounts, individual retirement accounts (IRAs), health savings accounts (HSAs), and money market accounts.

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