First Citizens BancShares (NASDAQ:FCNCA) and Orrstown Financial Services (NASDAQ:ORRF) 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.
Earnings & Valuation
This table compares First Citizens BancShares and Orrstown Financial Services’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|First Citizens BancShares||$1.65 billion||3.05||$400.31 million||N/A||N/A|
|Orrstown Financial Services||$86.69 million||2.19||$12.81 million||$1.81||11.05|
This is a breakdown of recent recommendations and price targets for First Citizens BancShares and Orrstown Financial Services, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|First Citizens BancShares||0||0||0||0||N/A|
|Orrstown Financial Services||0||1||2||0||2.67|
Orrstown Financial Services has a consensus target price of $26.50, suggesting a potential upside of 32.50%. Given Orrstown Financial Services’ higher possible upside, analysts clearly believe Orrstown Financial Services is more favorable than First Citizens BancShares.
Volatility and Risk
First Citizens BancShares has a beta of 1.18, suggesting that its stock price is 18% more volatile than the S&P 500. Comparatively, Orrstown Financial Services has a beta of 0.62, suggesting that its stock price is 38% less volatile than the S&P 500.
First Citizens BancShares pays an annual dividend of $1.60 per share and has a dividend yield of 0.4%. Orrstown Financial Services pays an annual dividend of $0.60 per share and has a dividend yield of 3.0%. Orrstown Financial Services pays out 33.1% of its earnings in the form of a dividend. Orrstown Financial Services has raised its dividend for 3 consecutive years. Orrstown Financial Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares First Citizens BancShares and Orrstown Financial Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|First Citizens BancShares||23.88%||11.60%||1.14%|
|Orrstown Financial Services||14.77%||9.91%||0.87%|
Insider & Institutional Ownership
46.7% of First Citizens BancShares shares are owned by institutional investors. Comparatively, 38.7% of Orrstown Financial Services shares are owned by institutional investors. 16.2% of First Citizens BancShares shares are owned by company insiders. Comparatively, 5.0% of Orrstown Financial Services shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
First Citizens BancShares beats Orrstown Financial Services on 11 of the 15 factors compared between the two stocks.
About First Citizens BancShares
First Citizens BancShares, Inc. operates as the holding company for First-Citizens Bank & Trust Company that provides banking services to retail and commercial customers. Its deposit products include checking, savings, money market and time deposit accounts. The company's loan products portfolio comprises commercial construction and land development, commercial mortgage, commercial and industrial, lease financing, and other commercial real estate loans; and noncommercial construction and land development, residential mortgage, revolving mortgage, consumer loans, and construction and land development loans. It also offers treasury services products, cardholder and merchant services, wealth management services, and various other products and services; investment services, including annuities, discount brokerage services, and third-party mutual funds, as well as investment advisory services; trust and asset management services; and title insurance products. The company offers its products and services through its branch network, as well as through digital banking, telephone banking, and various ATM networks. As of December 31, 2017, it operated 545 branches in Arizona, California, Colorado, Florida, Georgia, Illinois, Kansas, Maryland, Minnesota, Missouri, New Mexico, North Carolina, Oklahoma, Oregon, South Carolina, Tennessee, Texas, Virginia, Washington, West Virginia, and Wisconsin. The company was founded in 1898 and is headquartered in Raleigh, North Carolina.
About Orrstown Financial Services
Orrstown Financial Services, Inc. operates as the holding company for Orrstown Bank that provides commercial banking and trust services in the United States. The company accepts various deposits, including checking, savings, time, demand, and money market deposits. It also offers commercial loans, such as commercial real estate, equipment, working capital, and other commercial purpose loans; consumer loans comprising home equity and other consumer loans, as well as home equity lines of credit; residential mortgage loans; agribusiness loans; acquisition and development loans; municipal loans; and installment and other loans. In addition, the company provides renders services as trustee, executor, administrator, guardian, managing agent, custodian, and investment advisor, as well as provides other fiduciary services under the Orrstown Financial Advisors name; and offers retail brokerage services through a third-party broker/dealer arrangement. Further, it offers investment advisory services through an office in Lancaster County, Pennsylvania. The company provides its banking and bank-related services through branches located in Berks, Cumberland, Dauphin, Franklin, Lancaster, and Perry counties of Pennsylvania, as well as Washington County, Maryland. Orrstown Financial Services, Inc. was founded in 1919 and is headquartered in Shippensburg, Pennsylvania.
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