Southern Michigan Bancorp (OTCMKTS:SOMC) and Southside Bancshares (NASDAQ:SBSI) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, risk, profitability, earnings, dividends, analyst recommendations and valuation.
Insider & Institutional Ownership
2.5% of Southern Michigan Bancorp shares are owned by institutional investors. Comparatively, 52.6% of Southside Bancshares shares are owned by institutional investors. 5.8% of Southside Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Southern Michigan Bancorp pays an annual dividend of $0.88 per share and has a dividend yield of 2.3%. Southside Bancshares pays an annual dividend of $1.20 per share and has a dividend yield of 3.5%. Southside Bancshares pays out 56.9% of its earnings in the form of a dividend. Southside Bancshares has increased its dividend for 21 consecutive years. Southside Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of current ratings for Southern Michigan Bancorp and Southside Bancshares, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Southern Michigan Bancorp||0||0||0||0||N/A|
Southside Bancshares has a consensus price target of $37.00, suggesting a potential upside of 6.87%. Given Southside Bancshares’ higher possible upside, analysts clearly believe Southside Bancshares is more favorable than Southern Michigan Bancorp.
Risk & Volatility
Southern Michigan Bancorp has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500. Comparatively, Southside Bancshares has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500.
This table compares Southern Michigan Bancorp and Southside Bancshares’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Southern Michigan Bancorp||22.08%||11.06%||1.09%|
Valuation & Earnings
This table compares Southern Michigan Bancorp and Southside Bancshares’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Southern Michigan Bancorp||$36.24 million||2.42||$8.13 million||N/A||N/A|
|Southside Bancshares||$269.94 million||4.32||$74.14 million||$2.11||16.41|
Southside Bancshares has higher revenue and earnings than Southern Michigan Bancorp.
Southside Bancshares beats Southern Michigan Bancorp on 12 of the 14 factors compared between the two stocks.
Southern Michigan Bancorp Company Profile
Southern Michigan Bancorp, Inc. operates as the bank holding company for Southern Michigan Bank & Trust that provides a range of commercial banking services to individuals, businesses, institutions, and governmental agencies primarily in the southern Michigan communities. Its deposit products include interest and non-interest checking, passbook savings, and various types of money market accounts; time, savings, and demand deposits; and certificates of deposit. The company also provides home mortgages, equity loans, and personal loans; business loans, such as lines of credit, term loans, commercial real estate loans, agriculture loans, letters of credit, small business administration loans, and capital access loans; industrial, construction, real estate, and inventory loans; and consumer lending products comprising direct and indirect loans to purchasers of residential real property and consumer goods. In addition, it offers trust and investment services that include investment management, trustee, individual retirement account rollovers and retirement plan, institutional and personal custody, estate settlement, wealth management, estate and wealth transfer planning assistance, charitable gift planning assistance, and cash management custody services; and safe deposit box and automated teller machine services. Further, the company provides online and mobile banking, bill pay, e-statements, health savings account, business succession planning, life insurance, and remote deposit capture services, as well as payroll, prepaid, gift, and credit cards. It operates through a network of 14 banking offices located in Battle Creek, Camden, Centreville, Coldwater, Constantine, Hillsdale, Marshall, Mendon, Portage, Tekonsha, Three Rivers, and Union City, Michigan. The company was founded in 1871 and is based in Coldwater, Michigan.
Southside Bancshares Company Profile
Southside Bancshares, Inc. operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations. Its deposit products include savings, money market, and interest and noninterest bearing checking accounts, as well as certificates of deposit. The company's loan portfolio comprises consumer loans that include 1-4 family residential loans, home equity loans, home improvement loans, automobile loans, and other installment loans; commercial loans, such as short-term working capital loans for inventory and accounts receivable, short and medium-term loans for equipment or other business capital expansion, commercial real estate loans, and municipal loans; and construction loans for 1-4 family residential and commercial real estate. It also offers trust services consisting of investment management, administration, and advisory services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. The company operates through 59 branches and 40 motor bank facilities located in and around Arlington, Austin, Bullard, Chandler, Cleburne, Cleveland, Diboll, Euless, Flower Mound, Fort Worth, Frisco, Granbury, Grapevine, Gresham, Gun Barrel City, Hawkins, Hemphill, Irving, Jacksonville, Jasper, Lindale, Longview, Lufkin, Nacogdoches, Palestine, Pineland, San Augustine, Splendora, Tyler, Watauga, Weatherford, and Whitehouse; and a network of 83 automated teller machines, as well as wealth management and trust services, and/or loan production or other financial services offices. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.
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