Head-To-Head Analysis: Cathay General Bancorp (CATY) vs. Its Competitors

Cathay General Bancorp (NASDAQ: CATY) is one of 26 publicly-traded companies in the “Retail & Mortgage Banks” industry, but how does it compare to its rivals? We will compare Cathay General Bancorp to similar companies based on the strength of its dividends, profitability, earnings, valuation, analyst recommendations, risk and institutional ownership.

Dividends

Cathay General Bancorp pays an annual dividend of $0.84 per share and has a dividend yield of 2.1%. Cathay General Bancorp pays out 34.6% of its earnings in the form of a dividend. As a group, “Retail & Mortgage Banks” companies pay a dividend yield of 1.6% and pay out 28.0% of their earnings in the form of a dividend.

Profitability

This table compares Cathay General Bancorp and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cathay General Bancorp 35.30% 10.54% 1.36%
Cathay General Bancorp Competitors 14.82% -27.45% 0.87%

Insider and Institutional Ownership

67.8% of Cathay General Bancorp shares are owned by institutional investors. Comparatively, 53.5% of shares of all “Retail & Mortgage Banks” companies are owned by institutional investors. 5.8% of Cathay General Bancorp shares are owned by insiders. Comparatively, 12.1% of shares of all “Retail & Mortgage Banks” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Cathay General Bancorp has a beta of 1.31, suggesting that its share price is 31% more volatile than the S&P 500. Comparatively, Cathay General Bancorp’s rivals have a beta of 0.83, suggesting that their average share price is 17% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Cathay General Bancorp and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cathay General Bancorp 0 3 3 0 2.50
Cathay General Bancorp Competitors 108 454 488 12 2.38

Cathay General Bancorp presently has a consensus target price of $40.83, indicating a potential upside of 0.20%. As a group, “Retail & Mortgage Banks” companies have a potential upside of 25.49%. Given Cathay General Bancorp’s rivals higher probable upside, analysts clearly believe Cathay General Bancorp has less favorable growth aspects than its rivals.

Valuation and Earnings

This table compares Cathay General Bancorp and its rivals top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Cathay General Bancorp $475.33 million N/A 16.77
Cathay General Bancorp Competitors $678.45 million $169.32 million 12.12

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

Summary

Cathay General Bancorp beats its rivals on 9 of the 14 factors compared.

About Cathay General Bancorp

Cathay General Bancorp is a bank holding company. The Company holds Cathay Bank, a California state-chartered commercial bank (the Bank); seven limited partnerships investing in affordable housing investments; GBC Venture Capital, Inc., and Asia Realty Corp. The Company also owns the common stock of five statutory business trusts created for issuing capital securities. The Bank primarily services individuals, professionals and small to medium-sized businesses in the local markets and provides commercial mortgage loans, commercial loans, small business administration (SBA) loans, residential mortgage loans, real estate construction loans, home equity lines of credit and installment loans to individuals for automobile, household and other consumer expenditures. The Bank offers passbook accounts, checking accounts, money market deposit accounts, certificates of deposit, individual retirement accounts, college certificates of deposit and public funds deposits.

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