City Bank (OTCMKTS:CTBK – Get Free Report) and Enterprise Financial Services (NASDAQ:EFSC – Get Free Report) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.
Risk and Volatility
City Bank has a beta of 3.17, meaning that its share price is 217% more volatile than the S&P 500. Comparatively, Enterprise Financial Services has a beta of 1.08, meaning that its share price is 8% more volatile than the S&P 500.
Profitability
This table compares City Bank and Enterprise Financial Services’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| City Bank | N/A | N/A | N/A |
| Enterprise Financial Services | 30.42% | 14.58% | 1.61% |
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| City Bank | N/A | N/A | N/A | N/A | N/A |
| Enterprise Financial Services | $574.24 million | 2.45 | $203.04 million | $5.65 | 6.65 |
Enterprise Financial Services has higher revenue and earnings than City Bank.
Analyst Ratings
This is a breakdown of current ratings and target prices for City Bank and Enterprise Financial Services, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| City Bank | 0 | 0 | 0 | 0 | N/A |
| Enterprise Financial Services | 0 | 1 | 1 | 0 | 2.50 |
Enterprise Financial Services has a consensus price target of $52.67, suggesting a potential upside of 40.15%.
Insider & Institutional Ownership
71.4% of Enterprise Financial Services shares are held by institutional investors. 37.5% of City Bank shares are held by insiders. Comparatively, 3.8% of Enterprise Financial Services shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Summary
Enterprise Financial Services beats City Bank on 6 of the 8 factors compared between the two stocks.
About City Bank
As of April 17, 2010, City Bank was acquired by Whidbey Island Bank. City Bank offers commercial banking services. The company was incorporated in 1974 and is headquartered in Lynnwood, Washington.
About Enterprise Financial Services
Enterprise Financial Services Corp operates as the financial holding company for Enterprise Bank & Trust that offers banking and wealth management services to individuals and corporate customers. It offers checking, savings, and money market accounts, and certificates of deposit. The company also provides commercial and industrial, commercial real estate, construction and land development, residential real estate, agricultural, and consumer loans. In addition, it offers treasury management and international trade services; tax credit brokerage services consisting of the acquisition of tax credits and sale of these tax credits to clients; and financial and estate planning, investment management, and trust services to businesses, individuals, institutions, retirement plans, and non-profit organizations. Further, the company offers fiduciary, financial advisory, and merchant processing services; and debit and credit cards. Additionally, it provides international banking, insurance, internet and mobile banking, remote deposit capture, positive pay, fraud detection and prevention, automated payable, check imaging, and statement and document imaging services; and cash management products, controlled disbursements, repurchase agreements, and sweep investment accounts. The company was founded in 1988 and is headquartered in Clayton, Missouri.
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