Critical Survey: Customers Bancorp (NYSE:CUBI) and First Citizens BancShares (NASDAQ:FCNCA)

Customers Bancorp (NYSE:CUBI) and First Citizens BancShares (NASDAQ:FCNCA) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, valuation, dividends, risk, analyst recommendations and earnings.

Volatility and Risk

Customers Bancorp has a beta of 1.61, indicating that its share price is 61% more volatile than the S&P 500. Comparatively, First Citizens BancShares has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Customers Bancorp and First Citizens BancShares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Customers Bancorp	0	3	4	1	2.75
First Citizens BancShares	0	4	6	0	2.60

Customers Bancorp presently has a consensus target price of $62.00, suggesting a potential upside of 34.40%. First Citizens BancShares has a consensus target price of $2,025.90, suggesting a potential upside of 4.57%. Given Customers Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Customers Bancorp is more favorable than First Citizens BancShares.

Profitability

This table compares Customers Bancorp and First Citizens BancShares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Customers Bancorp	17.38%	17.09%	1.22%
First Citizens BancShares	18.19%	14.84%	1.41%

Valuation and Earnings

This table compares Customers Bancorp and First Citizens BancShares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Customers Bancorp	$773.85 million	1.89	$250.14 million	$7.16	6.44
First Citizens BancShares	$9.80 billion	2.87	$11.47 billion	$180.13	10.76

First Citizens BancShares has higher revenue and earnings than Customers Bancorp. Customers Bancorp is trading at a lower price-to-earnings ratio than First Citizens BancShares, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

89.3% of Customers Bancorp shares are owned by institutional investors. Comparatively, 61.2% of First Citizens BancShares shares are owned by institutional investors. 6.9% of Customers Bancorp shares are owned by company insiders. Comparatively, 13.4% of First Citizens BancShares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

First Citizens BancShares beats Customers Bancorp on 9 of the 15 factors compared between the two stocks.

About Customers Bancorp

Customers Bancorp, Inc. operates as the bank holding company for Customers Bank that provides financial products and services to individual consumers, and small and middle market businesses. The company provides deposit banking products, which includes commercial and consumer checking, non-interest-bearing and interest-bearing demand, MMDA, savings, and time deposit accounts. Its lending business offers commercial and industrial, commercial real estate, and multifamily and residential mortgage loans; SBA lending and financing; specialty lending includes fund finance, real estate specialty finance, technology and venture, and healthcare and financial institutions group; commercial loans to mortgage companies, and commercial equipment financing; and fund finance, such as variable rate loans secured by collateral pools to private debt funds; and cash management services. In addition, the company provides digital banking including Banking-as-a-Service to fintech companies, payments and treasury services to businesses, and consumer loans through fintech companies and the TassatPay, a blockchain-based instant B2B payments platform which offers instant payments including over-the-counter desks, exchanges, liquidity providers, market makers, funds, and other B2B verticals. Further, it offers mobile phone and internet banking, wire transfers, electronic bill payment, lock box, remote deposit capture, courier, merchant processing, cash vault, controlled disbursements, positive pay, and cash management services, such as account reconciliation, collections, and sweep accounts. The company was incorporated in 2010 and is headquartered in West Reading, Pennsylvania.

About First Citizens BancShares

First Citizens BancShares, Inc. operates as the holding company for First-Citizens Bank & Trust Company that provides retail and commercial banking services to individuals, businesses, and professionals. The company's deposit products include checking, savings, money market, and time deposit accounts. Its loan product portfolio comprises commercial construction and mortgage; and commercial and industrial leases, as well as small business administration loans. In addition, the company offers consumer loans, such as residential and revolving mortgage, consumer auto, and other consumer loans. Further, it provides wealth management services, including annuities, brokerage services, and third-party mutual funds, as well as investment management and advisory services. The company provides its products and services through its branch network. First Citizens BancShares, Inc. was founded in 1898 and is headquartered in Raleigh, North Carolina.