First Community (NASDAQ: FCCO) and Associated Banc (NYSE:ASB) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, analyst recommendations, profitability, earnings and valuation.
Insider & Institutional Ownership
47.9% of First Community shares are owned by institutional investors. Comparatively, 76.6% of Associated Banc shares are owned by institutional investors. 8.6% of First Community shares are owned by company insiders. Comparatively, 1.8% of Associated Banc shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This is a breakdown of current ratings for First Community and Associated Banc, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
First Community presently has a consensus price target of $21.00, suggesting a potential downside of 10.64%. Associated Banc has a consensus price target of $25.60, suggesting a potential upside of 2.20%. Given Associated Banc’s higher possible upside, analysts plainly believe Associated Banc is more favorable than First Community.
First Community pays an annual dividend of $0.36 per share and has a dividend yield of 1.5%. Associated Banc pays an annual dividend of $0.56 per share and has a dividend yield of 2.2%. First Community pays out 34.6% of its earnings in the form of a dividend. Associated Banc pays out 38.4% 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.
Earnings and Valuation
This table compares First Community and Associated Banc’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|First Community||$38.45 million||4.10||$6.68 million||$1.04||22.60|
|Associated Banc||$1.14 billion||3.31||$200.27 million||$1.46||17.16|
Associated Banc has higher revenue and earnings than First Community. Associated Banc is trading at a lower price-to-earnings ratio than First Community, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
First Community has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Associated Banc has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500.
This table compares First Community and Associated Banc’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Associated Banc beats First Community on 9 of the 16 factors compared between the two stocks.
About First Community
First Community Corporation is a bank holding company for First Community Bank (the Bank). The Bank offers commercial and retail banking services to small-to-medium sized businesses, professional concerns and individuals, primarily in Richland, Lexington, Kershaw and Newberry Counties of South Carolina and the surrounding areas. The Bank offers a range of traditional banking products and services for professionals and small-to medium-sized businesses, including consumer and commercial, mortgage, brokerage and investment, and insurance services. The Bank also offers online banking to its customers. Its other services include Internet banking, cash management services, safe deposit boxes, traveler checks, direct deposit of payroll and social security checks, and automatic drafts for various accounts. The Bank offers non-deposit investment products and other investment brokerage services through a registered representative with an affiliation through LPL Financial.
About Associated Banc
Associated Banc-Corp is a bank holding company. The Company, through its banking subsidiary Associated Bank, National Association (the Bank) and various nonbanking subsidiaries, provides a range of banking and non-banking products and services to individuals. The Company operates through three segments: Corporate and Commercial Specialty; Community, Consumer, and Business, and Risk Management and Shared Services. The Corporate and Commercial Specialty segment consists of lending and deposit solutions to businesses, developers, not-for-profits, municipalities and financial institutions. The Corporate and Commercial Specialty segment consists of lending and deposit solutions to businesses, developers, not-for-profits, municipalities and financial institutions. The Risk Management and Shared Services segment includes Corporate Risk Management, Credit Administration, Finance, Treasury, Operations and Technology, which are shared functions.
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