Pathward Financial (NASDAQ:CASH – Get Free Report) and FB Financial (NYSE:FBK – Get Free Report) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their risk, earnings, profitability, dividends, valuation, analyst recommendations and institutional ownership.
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for Pathward Financial and FB Financial, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Pathward Financial | 0 | 0 | 3 | 0 | 3.00 |
| FB Financial | 0 | 0 | 5 | 2 | 3.29 |
Pathward Financial presently has a consensus target price of $107.50, indicating a potential upside of 23.34%. FB Financial has a consensus target price of $64.00, indicating a potential upside of 14.62%. Given Pathward Financial’s higher probable upside, equities research analysts clearly believe Pathward Financial is more favorable than FB Financial.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Pathward Financial | 22.42% | 22.35% | 2.60% |
| FB Financial | 14.26% | 11.64% | 1.40% |
Insider & Institutional Ownership
92.7% of Pathward Financial shares are held by institutional investors. Comparatively, 65.4% of FB Financial shares are held by institutional investors. 1.4% of Pathward Financial shares are held by insiders. Comparatively, 2.0% of FB Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Dividends
Pathward Financial pays an annual dividend of $0.20 per share and has a dividend yield of 0.2%. FB Financial pays an annual dividend of $0.84 per share and has a dividend yield of 1.5%. Pathward Financial pays out 2.4% of its earnings in the form of a dividend. FB Financial pays out 31.6% 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. FB Financial has increased its dividend for 8 consecutive years. FB Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation & Earnings
This table compares Pathward Financial and FB Financial”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Pathward Financial | $685.48 million | 2.68 | $185.87 million | $8.42 | 10.35 |
| FB Financial | $602.54 million | 4.77 | $122.62 million | $2.66 | 20.99 |
Pathward Financial has higher revenue and earnings than FB Financial. Pathward Financial is trading at a lower price-to-earnings ratio than FB Financial, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Pathward Financial has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, FB Financial has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500.
About Pathward Financial
Pathward Financial, Inc. operates as the bank holding company for Pathward, National Association that provides various banking products and services in the United States. The company operates through three segments: Consumer, Commercial, and Corporate Services/Other. It offers demand deposit accounts, savings accounts, and money market savings accounts. The company also provides commercial finance product comprising term lending, asset-based lending, factoring, lease financing, insurance premium finance, government guaranteed lending, and other commercial finance products; consumer credit products; other consumer financing services; tax services, which includes short-term refund advance loans and short-term electronic return originator advance loans; and warehouse financing services. In addition, it issues prepaid cards; and offers payment solutions, such as acceptance, processing, and settlement of credit card and debit card payments. The company was formerly known as Meta Financial Group, Inc. and changed its name to Pathward Financial, Inc. in July 2022. Pathward Financial, Inc. was founded in 1954 and is based in Sioux Falls, South Dakota.
About FB Financial
FB Financial Corporation operates as a bank holding company for FirstBank that provides a suite of commercial and consumer banking services to businesses, professionals, and individuals. The company operates in segments, such as Banking and Mortgage. It offers checking, demand, money market, and savings accounts; deposit and lending products and services to corporate, commercial, and consumer customers; and time deposits and certificates of deposits, as well as residential mortgage loans. The company also provides owner-occupied and non-owner-occupied real estate commercial, residential real estate 1-4 family mortgage, multi-family residential, commercial and industrial, construction, land acquisition, residential lines of credit, and land development loans; and consumer and other loans, such as car, boat, and other recreational vehicle loans, as well as manufactured homes without real estate and personal lines of credit. In addition, the company offers mortgage banking services through its bank branch network and mortgage banking offices in the southeastern United States; direct-to-consumer internet delivery channel; and trust, insurance, and investment services, as well as online and mobile banking services. The company operates full-service bank branches and limited-service branches locations throughout Tennessee, Nashville, Chattanooga, Knoxville, Memphis, Jackson, Birmingham, Florence, Huntsville, Alabama, Bowling Green, and Kentucky; and mortgage offices throughout the southeastern United States. The company was formerly known as First South Bancorp, Inc. and changed its name to FB Financial Corporation in 2016. FB Financial Corporation was founded in 1906 and is headquartered in Nashville, Tennessee.
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