Texas Community Bancshares (NASDAQ:TCBS – Get Free Report) and First Bancorp (NASDAQ:FBNC – Get Free Report) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, valuation, profitability, institutional ownership, risk, analyst recommendations and earnings.
Insider & Institutional Ownership
15.8% of Texas Community Bancshares shares are held by institutional investors. Comparatively, 68.4% of First Bancorp shares are held by institutional investors. 15.3% of Texas Community Bancshares shares are held by insiders. Comparatively, 2.0% of First Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Dividends
Texas Community Bancshares pays an annual dividend of $0.24 per share and has a dividend yield of 1.3%. First Bancorp pays an annual dividend of $0.96 per share and has a dividend yield of 1.5%. Texas Community Bancshares pays out 22.0% of its earnings in the form of a dividend. First Bancorp pays out 32.8% 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. Texas Community Bancshares has increased its dividend for 1 consecutive years.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Texas Community Bancshares | 11.79% | 5.66% | 0.70% |
| First Bancorp | 20.59% | 10.86% | 1.38% |
Valuation & Earnings
This table compares Texas Community Bancshares and First Bancorp”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Texas Community Bancshares | $25.57 million | 2.01 | $2.84 million | $1.09 | 16.33 |
| First Bancorp | $549.30 million | 4.83 | $111.05 million | $2.93 | 21.86 |
First Bancorp has higher revenue and earnings than Texas Community Bancshares. Texas Community Bancshares is trading at a lower price-to-earnings ratio than First Bancorp, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Texas Community Bancshares has a beta of -0.03, meaning that its stock price is 103% less volatile than the S&P 500. Comparatively, First Bancorp has a beta of 0.8, meaning that its stock price is 20% less volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings for Texas Community Bancshares and First Bancorp, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Texas Community Bancshares | 0 | 1 | 0 | 0 | 2.00 |
| First Bancorp | 0 | 3 | 3 | 1 | 2.71 |
First Bancorp has a consensus target price of $65.55, indicating a potential upside of 2.34%. Given First Bancorp’s stronger consensus rating and higher probable upside, analysts clearly believe First Bancorp is more favorable than Texas Community Bancshares.
Summary
First Bancorp beats Texas Community Bancshares on 15 of the 18 factors compared between the two stocks.
About Texas Community Bancshares
Texas Community Bancshares, Inc. operates as the bank holding company for Mineola Community Bank, S.S.B. that provides loans and banking services to consumers and commercial customers in Mineola, Texas and the surrounding area, and the Dallas Fort Worth Metroplex. It generates a selection of deposit accounts, including savings accounts, checking accounts, certificates of deposit, and individual retirement accounts. The company also originates primarily one- to four-family residential mortgage loans, commercial real estate loans, and construction and land loans; and car, boat, share, unsecured loans, etc., as well as agricultural loans, commercial loans, and consumer and other loans. In addition, it invests in securities; and offers sweep account, safe deposit boxes, e-statement, cards, online banking, and mobile banking services. Texas Community Bancshares, Inc. was founded in 1934 and is headquartered in Mineola, Texas.
About First Bancorp
First Bancorp operates as the bank holding company for First Bank that provides banking products and services for individuals and small to medium-sized businesses. The company accepts deposit products, such as checking, savings, and money market accounts, as well as time deposits, including certificate of deposits and individual retirement accounts. It also offers loans for a range of consumer and commercial purposes comprising loans for business, real estate, personal, home improvement, and automobiles, as well as residential mortgages and small business administration loans; and accounts receivable financing and factoring, inventory financing, and purchase order financing services. In addition, the company provides credit and debit cards, letter of credits, and safe deposit box rental services, as well as electronic funds transfer services consisting of wire transfers; and internet and mobile banking, cash management, bank-by-phone services, and remote deposit capture services. Further, it offers investment and insurance products, such as mutual funds, annuities, long-term care insurance, life insurance, and company retirement plans, as well as property and casualty insurance products; and financial planning services. The company was founded in 1934 and is headquartered in Southern Pines, North Carolina.
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