Signature Bank (NASDAQ:SBNY) and Oak Valley Bancorp (NASDAQ:OVLY) Critical Analysis

Insider & Institutional Ownership

30.9% of Oak Valley Bancorp shares are held by institutional investors. Comparatively, 11.1% of Signature Bank shares are held by institutional investors. 19.3% of Oak Valley Bancorp shares are held by company insiders. Comparatively, 1.5% of Signature Bank shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

Oak Valley Bancorp pays an annual dividend of $0.45 per share and has a dividend yield of 1.6%. Signature Bank pays an annual dividend of $0.70 per share and has a dividend yield of 56.9%. Oak Valley Bancorp pays out 15.0% of its earnings in the form of a dividend. Signature Bank pays out 4.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Signature Bank is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Oak Valley Bancorp and Signature Bank”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oak Valley Bancorp	$76.98 million	2.99	$30.85 million	$3.00	9.17
Signature Bank	$2.70 billion	0.03	$1.34 billion	$16.38	0.08

Signature Bank has higher revenue and earnings than Oak Valley Bancorp. Signature Bank is trading at a lower price-to-earnings ratio than Oak Valley Bancorp, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Oak Valley Bancorp and Signature Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oak Valley Bancorp	28.03%	14.38%	1.34%
Signature Bank	N/A	N/A	N/A

Volatility and Risk

Oak Valley Bancorp has a beta of 0.35, indicating that its stock price is 65% less volatile than the S&P 500. Comparatively, Signature Bank has a beta of 9.5, indicating that its stock price is 850% more volatile than the S&P 500.

Summary

Oak Valley Bancorp beats Signature Bank on 7 of the 13 factors compared between the two stocks.

About Oak Valley Bancorp

Oak Valley Bancorp operates as the bank holding company for Oak Valley Community Bank that provides a range of commercial banking services to individuals and small to medium-sized businesses in the Central Valley and the Eastern Sierras. The company's deposits products include checking and savings, money market, health savings, and individual retirement accounts, as well as certificates of deposit. It also offers commercial real estate loans, commercial business lending and trade finance, and small business administration lending, as well as consumer loans, including automobile loans, home mortgages, credit lines, and other personal loans. In addition, the company provides online and mobile banking, remote deposit capture, merchant, night depository, extended hours, wire transfer of funds, note collection services, and automated teller machines. The company was incorporated in 1990 and is headquartered in Oakdale, California.

About Signature Bank

As of March 12, 2023, Signature Bank went out of business. Previously, the company provided digital assets banking services and comprised of certain loan portfolios. The company was incorporated in 2000 and is based in New York, New York. Signature Bank now trades on OTCPK.