First Financial Bankshares (NASDAQ:FFIN) and Two Rivers Bancorp (NASDAQ:TRCB) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, risk, earnings, dividends and institutional ownership.
This table compares First Financial Bankshares and Two Rivers Bancorp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|First Financial Bankshares||38.47%||15.03%||2.01%|
|Two Rivers Bancorp||21.98%||10.05%||1.06%|
First Financial Bankshares pays an annual dividend of $0.84 per share and has a dividend yield of 1.3%. Two Rivers Bancorp pays an annual dividend of $0.22 per share and has a dividend yield of 1.4%. First Financial Bankshares pays out 38.5% of its earnings in the form of a dividend. Two Rivers Bancorp pays out 16.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. First Financial Bankshares has increased its dividend for 8 consecutive years and Two Rivers Bancorp has increased its dividend for 5 consecutive years. Two Rivers Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.
Risk and Volatility
First Financial Bankshares has a beta of 1.14, suggesting that its share price is 14% more volatile than the S&P 500. Comparatively, Two Rivers Bancorp has a beta of 0.4, suggesting that its share price is 60% less volatile than the S&P 500.
Earnings & Valuation
This table compares First Financial Bankshares and Two Rivers Bancorp’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|First Financial Bankshares||$393.45 million||10.84||$150.64 million||$2.18||28.84|
|Two Rivers Bancorp||$50.02 million||2.63||$11.21 million||$1.31||11.60|
First Financial Bankshares has higher revenue and earnings than Two Rivers Bancorp. Two Rivers Bancorp is trading at a lower price-to-earnings ratio than First Financial Bankshares, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current recommendations for First Financial Bankshares and Two Rivers Bancorp, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|First Financial Bankshares||0||2||0||0||2.00|
|Two Rivers Bancorp||0||0||2||0||3.00|
First Financial Bankshares presently has a consensus price target of $58.50, indicating a potential downside of 6.95%. Two Rivers Bancorp has a consensus price target of $18.00, indicating a potential upside of 18.42%. Given Two Rivers Bancorp’s stronger consensus rating and higher probable upside, analysts clearly believe Two Rivers Bancorp is more favorable than First Financial Bankshares.
Insider and Institutional Ownership
55.0% of First Financial Bankshares shares are held by institutional investors. Comparatively, 23.0% of Two Rivers Bancorp shares are held by institutional investors. 4.9% of First Financial Bankshares shares are held by insiders. Comparatively, 15.0% of Two Rivers Bancorp shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
First Financial Bankshares beats Two Rivers Bancorp on 11 of the 17 factors compared between the two stocks.
First Financial Bankshares Company Profile
First Financial Bankshares, Inc., through its subsidiaries, provides commercial banking products and services primarily in Texas. The company accepts checking, savings, and time deposits; and offers real estate, commercial, agricultural, and consumer loans to businesses, professionals, individuals, and farm and ranch operations. It also provides automated teller machine, drive-in and night deposit, safe deposit facility, remote deposit capture, Internet banking, mobile banking, payroll card, transmitting fund, and other customary commercial banking services. In addition, the company offers personal trust services, including wealth management, administration of estates, testamentary trusts, revocable and irrevocable trusts, and agency accounts; and securities brokerage services, as well as administers retirement and employee benefit accounts, such as 401(k) profit sharing plans and IRAs. As of January 24, 2019, it had 73 locations comprising Abilene, Acton, Albany, Aledo, Alvarado, Beaumont, Boyd, Bridgeport, Brock, Burleson, Cisco, Cleburne, Clyde, Conroe, Cut and Shoot, Decatur, Eastland, El Campo, Fort Worth, Fulshear, Glen Rose, Granbury, Grapevine, Hereford, Huntsville, Keller, Kingwood, Magnolia, Mauriceville, Merkel, Midlothian, Mineral Wells, Montgomery, Moran, New Waverly, Newton, Odessa, Orange, Palacios, Port Arthur, Ranger, Rising Star, Roby, San Angelo, Southlake, Spring, Stephenville, Sweetwater, Tomball, Trent, Trophy Club, Vidor, Waxahachie, Weatherford, Willis, and Willow Park. The company also provides asset management and technology services. First Financial Bankshares, Inc. was founded in 1890 and is headquartered in Abilene, Texas.
Two Rivers Bancorp Company Profile
Two River Bancorp operates as the bank holding company for Two River Community Bank that provides a range of banking services to small and medium-sized businesses, not-for-profit organizations, professionals, and individuals. The company offers deposit products, including checking, savings, and money market accounts, as well as certificates of deposit. It also provides construction and land development loans; commercial and industrial loans; commercial real estate loans; residential real estate loans consisting of single-family detached units, individual condominium units, two-to-four family dwelling units, and townhouses; consumer loans comprising home equity lines of credit, home equity loans, personal loans, automobile loans, and overdraft protection; participation loans; and small business administration loans. In addition, the company offers remote deposit capture, ACH, direct deposit, coin counting, night depository, corporate business, and telephone and Internet banking services; and safe deposit boxes, debit and ATM cards, money orders, wire transfers, and automated teller machines. It operates 14 branches and 2 loan production offices in Monmouth, Middlesex, Union, and Ocean Counties, New Jersey. The company was formerly known as Community Partners Bancorp and changed its name to Two River Bancorp in June 2013. Two River Bancorp was founded in 2000 and is headquartered in Tinton Falls, New Jersey.
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