Coastal Financial Corporation's Financial Performance Analysis

• Coastal Financial Corporation (NASDAQ:CCB) has a ROIC of 3.50% and a WACC of 15.73%, indicating it is not generating sufficient returns to cover its cost of capital.
• Comparatively, Esquire Financial Holdings, Inc. (NASDAQ:ESQ) showcases a ROIC of 16.90% and a WACC of 6.37%, significantly outperforming CCB in capital efficiency.

Coastal Financial Corporation (NASDAQ:CCB) is a financial institution that provides a range of banking services. It operates primarily in the United States, offering personal and business banking solutions. The company competes with other financial institutions like Business First Bancshares, Inc. (BFST), Bank7 Corp. (BSVN), Capital Bancorp, Inc. (CBNK), First Western Financial, Inc. (MYFW), and Esquire Financial Holdings, Inc. (ESQ).

In evaluating CCB's financial performance, the Return on Invested Capital (ROIC) and Weighted Average Cost of Capital (WACC) are crucial metrics. CCB's ROIC is 3.50%, while its WACC is 15.73%, resulting in a ROIC to WACC ratio of 0.22. This indicates that CCB is not generating returns sufficient to cover its cost of capital, which may concern investors.

Comparatively, Business First Bancshares, Inc. (BFST) has a ROIC of 0.86% and a WACC of 18.17%, leading to a ROIC to WACC ratio of 0.05. This suggests BFST is also struggling to generate returns above its cost of capital, similar to CCB. Bank7 Corp. (BSVN), however, shows a more favorable position with a ROIC of 2.60% and a WACC of 9.09%, resulting in a ROIC to WACC ratio of 0.29, indicating better capital efficiency than CCB. On the other hand, First Western Financial, Inc. (MYFW) has a ROIC of 10.38% and a WACC of 26.09%, resulting in a ROIC to WACC ratio of 0.40, showing better performance than CCB.

Esquire Financial Holdings, Inc. (ESQ) stands out with a ROIC of 16.90% and a WACC of 6.37%, leading to a ROIC to WACC ratio of 2.65. This indicates ESQ is generating returns significantly above its cost of capital, suggesting efficient capital utilization and potentially higher value creation for shareholders. This performance highlights ESQ as a leader among its peers in terms of capital efficiency.