Critical Contrast: PEOPLES BK COMM/SH (OTCMKTS:PBCO) versus National Bankshares (OTCMKTS:NKSH)

National Bankshares (NASDAQ:NKSH) and PEOPLES BK COMM/SH (OTCMKTS:PBCO) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, dividends and valuation.

Valuation and Earnings

This table compares National Bankshares and PEOPLES BK COMM/SH’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
National Bankshares $50.95 million 4.35 $16.15 million N/A N/A
PEOPLES BK COMM/SH $20.04 million 2.32 $3.40 million N/A N/A

National Bankshares has higher revenue and earnings than PEOPLES BK COMM/SH.

Insider and Institutional Ownership

30.0% of National Bankshares shares are owned by institutional investors. Comparatively, 8.6% of PEOPLES BK COMM/SH shares are owned by institutional investors. 3.7% of National Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk and Volatility

National Bankshares has a beta of 0.48, suggesting that its share price is 52% less volatile than the S&P 500. Comparatively, PEOPLES BK COMM/SH has a beta of 0.49, suggesting that its share price is 51% less volatile than the S&P 500.

Dividends

National Bankshares pays an annual dividend of $1.34 per share and has a dividend yield of 3.9%. PEOPLES BK COMM/SH does not pay a dividend. National Bankshares has increased its dividend for 17 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for National Bankshares and PEOPLES BK COMM/SH, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
National Bankshares 0 0 1 0 3.00
PEOPLES BK COMM/SH 0 0 0 0 N/A

National Bankshares currently has a consensus price target of $42.50, suggesting a potential upside of 24.89%. Given National Bankshares’ higher possible upside, research analysts plainly believe National Bankshares is more favorable than PEOPLES BK COMM/SH.

Profitability

This table compares National Bankshares and PEOPLES BK COMM/SH’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
National Bankshares 33.22% 9.28% 1.37%
PEOPLES BK COMM/SH 17.03% N/A N/A

Summary

National Bankshares beats PEOPLES BK COMM/SH on 13 of the 14 factors compared between the two stocks.

National Bankshares Company Profile

National Bankshares, Inc. operates as the bank holding company for the National Bank of Blacksburg that provides retail and commercial banking services to individuals, businesses, non-profits, and local governments. The company accepts interest-bearing and non-interest bearing demand deposit accounts, money market deposit accounts, savings accounts, certificates of deposit, and individual retirement accounts. Its loan products include commercial and agricultural, commercial real estate, residential real estate, home equity, and various consumer loan products, as well as loans for the construction of commercial and residential properties. The company also provides business and consumer debit and credit cards; letters of credit, night depository, safe deposit boxes, utility payment services, and automatic funds transfer; wealth management, trust, and estate services for individual and business customers; non-deposit investment and insurance products; and telephone, mobile, and Internet banking services. As of February 22, 2018, it operated 24 branch offices, a loan production office, and 24 automated teller machines in Southwest Virginia. National Bankshares, Inc. was founded in 1891 and is headquartered in Blacksburg, Virginia.

PEOPLES BK COMM/SH Company Profile

People's Bank of Commerce provides banking services to businesses and individuals primarily in Southern Oregon. It offers various deposit products, including checking, savings, and money market accounts, as well as certificates of deposit. The company's personal loans consist of home equity loans and credit lines; consumer loans and credit lines comprising auto, recreational vehicle, boat, personal line of credit, and savings secured loans; and home lot and construction loans. Its business loan portfolio includes commercial loans comprising commercial real estate, equipment purchase, certificates of deposit and listed stock secured, commercial real estate construction, residential construction loans, and lines of credit; and small business/government loans. In addition, the company provides merchant services, online and mobile banking, bill pay, e-statements, sweep accounts, debit and credit cards, and ATM cards. It operates six full-service branches in Ashland, Central Point, Grants Pass, and Medford, Oregon. People's Bank of Commerce was incorporated in 1997 and is headquartered in Medford, Oregon.

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