Virginia Commerce Bancorp (NASDAQ: VCBI) and Live Oak Bancshares (NASDAQ:LOB) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitabiliy, analyst recommendations, earnings, risk, valuation and dividends.

Earnings and Valuation

This table compares Virginia Commerce Bancorp and Live Oak Bancshares’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Virginia Commerce Bancorp N/A N/A N/A N/A N/A
Live Oak Bancshares $133.84 million 6.59 $14.88 million $0.43 59.30

Live Oak Bancshares has higher revenue and earnings than Virginia Commerce Bancorp.

Dividends

Live Oak Bancshares pays an annual dividend of $0.08 per share and has a dividend yield of 0.3%. Virginia Commerce Bancorp does not pay a dividend. Live Oak Bancshares pays out 18.6% of its earnings in the form of a dividend.

Institutional and Insider Ownership

36.1% of Live Oak Bancshares shares are held by institutional investors. 30.1% of Live Oak Bancshares shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Virginia Commerce Bancorp and Live Oak Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Virginia Commerce Bancorp N/A N/A N/A
Live Oak Bancshares 9.31% 8.98% 1.16%

Analyst Ratings

This is a summary of current recommendations and price targets for Virginia Commerce Bancorp and Live Oak Bancshares, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Virginia Commerce Bancorp 0 0 0 0 N/A
Live Oak Bancshares 0 0 1 0 3.00

Live Oak Bancshares has a consensus target price of $15.00, suggesting a potential downside of 41.18%. Given Live Oak Bancshares’ higher probable upside, analysts plainly believe Live Oak Bancshares is more favorable than Virginia Commerce Bancorp.

Summary

Live Oak Bancshares beats Virginia Commerce Bancorp on 9 of the 10 factors compared between the two stocks.

About Virginia Commerce Bancorp

Virginia Commerce Bancorp, Inc. is the holding company for Virginia Commerce Bank (the Bank). The Bank is a full-service community bank that provides loan and deposit products to commercial and retail customers in the Washington Metropolitan Area, with the primary focus on Northern Virginia. The Bank’s customer base includes small-to-medium sized businesses, including firms that have contracts with the United States Government, associations, retailers and industrial businesses, professionals and their firms, business executives, investors and consumers. The Bank’s primary service area consists of the Northern Virginia suburbs of Washington, D.C., including Arlington, Fairfax, Fauquier, Loudoun, Prince William, Spotsylvania and Stafford Counties and the cities of Alexandria, Fairfax, Falls Church, Fredericksburg, Manassas and Manassas Park. Effective January 31, 2014, United Bankshares Inc acquired the entire share capital of Virginia Commerce Bancorp Inc.

About Live Oak Bancshares

Live Oak Bancshares, Inc. is a bank holding company. The Company conducts business operations primarily through its commercial bank subsidiary, Live Oak Banking Company (the Bank). The Bank specializes in providing lending services to small businesses nationwide in targeted industries. The loans originated by the Bank are guaranteed by the small business administration (SBA). The Company’s loan portfolio includes commercial and industrial loans; construction and development loans; commercial real estate, and commercial land. The Company’s investment securities include the United States Government agencies, residential mortgage-backed securities and mutual fund. The Company’s deposits include non-interest-bearing deposits and interest-bearing deposits, such as interest-bearing checking, money market and time deposits.

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