Contrasting Community West Bancshares (NASDAQ:CWBC) & Upstart (NASDAQ:UPST)

Community West Bancshares (NASDAQ:CWBC) and Upstart (NASDAQ:UPST) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, dividends, risk, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

33.8% of Community West Bancshares shares are held by institutional investors. Comparatively, 63.0% of Upstart shares are held by institutional investors. 10.6% of Community West Bancshares shares are held by insiders. Comparatively, 16.7% of Upstart shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Community West Bancshares and Upstart, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Community West Bancshares	0	2	2	0	2.50
Upstart	1	7	5	0	2.31

Community West Bancshares presently has a consensus target price of $21.67, suggesting a potential upside of 1.25%. Upstart has a consensus target price of $81.08, suggesting a potential upside of 29.98%. Given Upstart’s higher possible upside, analysts clearly believe Upstart is more favorable than Community West Bancshares.

Volatility & Risk

Community West Bancshares has a beta of 0.9, indicating that its share price is 10% less volatile than the S&P 500. Comparatively, Upstart has a beta of 2.37, indicating that its share price is 137% more volatile than the S&P 500.

Profitability

This table compares Community West Bancshares and Upstart’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Community West Bancshares	13.88%	7.91%	0.82%
Upstart	-0.75%	-5.95%	-1.75%

Earnings and Valuation

This table compares Community West Bancshares and Upstart”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Community West Bancshares	$46.27 million	8.85	$7.67 million	$1.39	15.40
Upstart	$636.53 million	9.43	-$128.58 million	($0.08)	-779.75

Community West Bancshares has higher earnings, but lower revenue than Upstart. Upstart is trading at a lower price-to-earnings ratio than Community West Bancshares, indicating that it is currently the more affordable of the two stocks.

About Community West Bancshares

Community West Bancshares operates as the bank holding company for Community West Bank, N.A. that provides various financial products and services in California. The company offers deposit products, such as checking accounts, savings accounts, money market accounts, and fixed rate and fixed maturity certificates of deposits; and cash management products. It also provides commercial, commercial real estate, consumer, manufactured housing, and small business administration loans, as well as agricultural loans for real estate and operating lines; home equity lines of credit collateralized by residential real estate; single family real estate loans; and installment loans consisting of automobile and general-purpose loans. The company serves small to medium-sized businesses and their owners, professionals, high-net worth individuals, and non-profit organizations. Community West Bancshares was founded in 1989 and is headquartered in Goleta, California.

About Upstart

Upstart Holdings, Inc., together with its subsidiaries, operates a cloud-based artificial intelligence (AI) lending platform in the United States. Its platform includes personal loans, automotive retail and refinance loans, home equity lines of credit, and small dollar loans that connects consumer demand for loans to its to bank and credit unions. Upstart Holdings, Inc. was founded in 2012 and is headquartered in San Mateo, California.