Head-To-Head Contrast: Pacific Premier Bancorp (NASDAQ:PPBI) and Bankwell Financial Group (NASDAQ:BWFG)

Bankwell Financial Group (NASDAQ:BWFG) and Pacific Premier Bancorp (NASDAQ:PPBI) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, institutional ownership, valuation, risk and profitability.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Bankwell Financial Group and Pacific Premier Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bankwell Financial Group	0	0	1	0	3.00
Pacific Premier Bancorp	0	3	3	0	2.50

Bankwell Financial Group currently has a consensus price target of $34.00, indicating a potential upside of 14.25%. Pacific Premier Bancorp has a consensus price target of $26.83, indicating a potential upside of 8.90%. Given Bankwell Financial Group’s stronger consensus rating and higher probable upside, research analysts clearly believe Bankwell Financial Group is more favorable than Pacific Premier Bancorp.

Volatility and Risk

Bankwell Financial Group has a beta of 0.83, suggesting that its stock price is 17% less volatile than the S&P 500. Comparatively, Pacific Premier Bancorp has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500.

Profitability

This table compares Bankwell Financial Group and Pacific Premier Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bankwell Financial Group	11.76%	8.76%	0.73%
Pacific Premier Bancorp	N/A	6.34%	0.96%

Insider & Institutional Ownership

35.8% of Bankwell Financial Group shares are held by institutional investors. Comparatively, 93.1% of Pacific Premier Bancorp shares are held by institutional investors. 19.2% of Bankwell Financial Group shares are held by insiders. Comparatively, 2.2% of Pacific Premier Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Dividends

Bankwell Financial Group pays an annual dividend of $0.80 per share and has a dividend yield of 2.7%. Pacific Premier Bancorp pays an annual dividend of $1.32 per share and has a dividend yield of 5.4%. Bankwell Financial Group pays out 20.8% of its earnings in the form of a dividend. Pacific Premier Bancorp pays out 1,015.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Earnings and Valuation

This table compares Bankwell Financial Group and Pacific Premier Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bankwell Financial Group	$193.30 million	1.21	$36.66 million	$3.84	7.75
Pacific Premier Bancorp	$356.77 million	6.66	$30.85 million	$0.13	189.54

Bankwell Financial Group has higher earnings, but lower revenue than Pacific Premier Bancorp. Bankwell Financial Group is trading at a lower price-to-earnings ratio than Pacific Premier Bancorp, indicating that it is currently the more affordable of the two stocks.

About Bankwell Financial Group

Bankwell Financial Group, Inc. operates as the bank holding company for Bankwell Bank that provides various banking services for individual and commercial customers. It offers various traditional depository products, including checking, savings, money market, and certificates of deposit. The company also provides first mortgage loans secured by one-to-four family owner occupied residential properties for personal use; home equity loans and home equity lines of credit secured by owner occupied one-to-four family residential properties; loans secured by commercial real estate, multi-family dwellings, owner-occupied commercial real estate, and investor-owned one-to-four family dwellings; commercial construction loans for commercial development projects, including apartment buildings and condominiums, as well as office buildings, retail, and other income producing properties; land loans; commercial business loans secured by assignments of corporate assets and personal guarantees of the business owners; loans to finance insurance premiums; overdraft lines of credit; and unsecured personal loans. It operates branches in New Canaan, Stamford, Fairfield, Westport, Darien, Norwalk, and Hamden, Connecticut. The company was formerly known as BNC Financial Group, Inc. and changed its name to Bankwell Financial Group, Inc. in September 2013. Bankwell Financial Group, Inc. was founded in 2002 and is headquartered in New Canaan, Connecticut.

About Pacific Premier Bancorp

Pacific Premier Bancorp, Inc. operates as the bank holding company for Pacific Premier Bank that provides various banking products and services in the United States. The company accepts deposit products, which includes checking, money market, savings accounts, and certificates of deposit. Its loan portfolio includes commercial real estate owner and non-owner-occupied, multifamily, construction and land, franchise real estate secured, and small business administration (SBA); revolving lines of credit, term loans, seasonal loans, and loans secured by liquid collateral; one-to-four family and home equity lines of credit loans; and small balance personal unsecured loans and savings account secured loans. It also offers cash management, online and mobile banking, and treasury management services, as well as payment processing, remote capture, and automated clearing house payment capabilities. In addition, it operates as a custodian for alternative assets held in qualified self-directed IRA accounts, including investments in private equity, real estate, notes, cash, and other non-exchange traded assets; and provides real-property and non-real property escrow services. The company serves small and middle-market businesses, corporations, professionals, real estate investors, non-profit organizations, and consumers. The company was founded in 1983 and is headquartered in Irvine, California.