Financial Survey: Bank of Nova Scotia (NYSE:BNS) versus Pacific Premier Bancorp (NASDAQ:PPBI)

Pacific Premier Bancorp (NASDAQ:PPBI) and Bank of Nova Scotia (NYSE:BNS) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Analyst Ratings

This is a summary of current recommendations for Pacific Premier Bancorp and Bank of Nova Scotia, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pacific Premier Bancorp	0	3	3	0	2.50
Bank of Nova Scotia	1	3	0	1	2.20

Pacific Premier Bancorp currently has a consensus target price of $26.83, suggesting a potential downside of 1.24%. Bank of Nova Scotia has a consensus target price of $69.00, suggesting a potential upside of 28.53%. Given Bank of Nova Scotia’s higher possible upside, analysts plainly believe Bank of Nova Scotia is more favorable than Pacific Premier Bancorp.

Dividends

Pacific Premier Bancorp pays an annual dividend of $1.32 per share and has a dividend yield of 4.9%. Bank of Nova Scotia pays an annual dividend of $3.13 per share and has a dividend yield of 5.8%. Pacific Premier Bancorp pays out 1,015.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Bank of Nova Scotia pays out 70.5% of its earnings in the form of a dividend. Bank of Nova Scotia is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

93.1% of Pacific Premier Bancorp shares are owned by institutional investors. Comparatively, 49.1% of Bank of Nova Scotia shares are owned by institutional investors. 2.2% of Pacific Premier Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Pacific Premier Bancorp and Bank of Nova Scotia’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pacific Premier Bancorp	N/A	6.34%	0.96%
Bank of Nova Scotia	9.84%	11.14%	0.57%

Volatility and Risk

Pacific Premier Bancorp has a beta of 1.22, meaning that its stock price is 22% more volatile than the S&P 500. Comparatively, Bank of Nova Scotia has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500.

Earnings & Valuation

This table compares Pacific Premier Bancorp and Bank of Nova Scotia”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pacific Premier Bancorp	$356.77 million	7.34	$30.85 million	$0.13	209.00
Bank of Nova Scotia	$33.11 billion	1.99	$5.49 billion	$4.44	12.09

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

Summary

Bank of Nova Scotia beats Pacific Premier Bancorp on 9 of the 17 factors compared between the two stocks.

About Pacific Premier Bancorp

Pacific Premier Bancorp, Inc. operates as the bank holding company for Pacific Premier Bank that provides various banking products and services in the United States. The company accepts deposit products, which includes checking, money market, savings accounts, and certificates of deposit. Its loan portfolio includes commercial real estate owner and non-owner-occupied, multifamily, construction and land, franchise real estate secured, and small business administration (SBA); revolving lines of credit, term loans, seasonal loans, and loans secured by liquid collateral; one-to-four family and home equity lines of credit loans; and small balance personal unsecured loans and savings account secured loans. It also offers cash management, online and mobile banking, and treasury management services, as well as payment processing, remote capture, and automated clearing house payment capabilities. In addition, it operates as a custodian for alternative assets held in qualified self-directed IRA accounts, including investments in private equity, real estate, notes, cash, and other non-exchange traded assets; and provides real-property and non-real property escrow services. The company serves small and middle-market businesses, corporations, professionals, real estate investors, non-profit organizations, and consumers. The company was founded in 1983 and is headquartered in Irvine, California.

About Bank of Nova Scotia

The Bank of Nova Scotia provides various banking products and services in Canada, the United States, Mexico, Peru, Chile, Colombia, the Caribbean and Central America, and internationally. It operates through Canadian Banking, International Banking, Global Wealth Management, and Global Banking and Markets segments. The company offers financial advice and solutions, and banking products, including debit and credit cards, chequing and saving accounts, investments, mortgages, loans, and insurance to individuals; and retail automotive financing solutions. It also provides business banking solutions comprising lending, deposit, cash management, and trade finance solutions to small, medium, and large businesses. In addition, it provides wealth management advice and solutions, including online brokerage, mobile investment, full-service brokerage, trust, private banking, and private investment counsel services; and retail mutual funds, exchange traded funds, liquid alternatives, and institutional funds. The Bank of Nova Scotia was founded in 1832 and is headquartered in Toronto, Canada.