Contrasting Southside Bancshares (NYSE:SBSI) & Freddie Mac (OTCMKTS:FMCC)

Southside Bancshares (NYSE:SBSI) and Freddie Mac (OTCMKTS:FMCC) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, risk, dividends, valuation and profitability.

Earnings & Valuation

This table compares Southside Bancshares and Freddie Mac”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Southside Bancshares	$419.03 million	2.17	$69.18 million	$2.54	12.02
Freddie Mac	$129.82 billion	0.02	$10.73 billion	$0.01	392.00

Freddie Mac has higher revenue and earnings than Southside Bancshares. Southside Bancshares is trading at a lower price-to-earnings ratio than Freddie Mac, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Southside Bancshares has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, Freddie Mac has a beta of 1.74, meaning that its share price is 74% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and target prices for Southside Bancshares and Freddie Mac, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southside Bancshares	0	5	1	0	2.17
Freddie Mac	1	2	1	1	2.40

Southside Bancshares presently has a consensus price target of $34.75, indicating a potential upside of 13.84%. Freddie Mac has a consensus price target of $11.12, indicating a potential upside of 183.80%. Given Freddie Mac’s stronger consensus rating and higher probable upside, analysts clearly believe Freddie Mac is more favorable than Southside Bancshares.

Profitability

This table compares Southside Bancshares and Freddie Mac’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Southside Bancshares	16.70%	11.16%	1.11%
Freddie Mac	9.58%	-90.29%	0.37%

Institutional & Insider Ownership

55.7% of Southside Bancshares shares are owned by institutional investors. 5.1% of Southside Bancshares shares are owned by insiders. Comparatively, 0.1% of Freddie Mac shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

About Southside Bancshares

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 consumer related 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 wealth management and trust services consisting of investment management, administration, revocable and testamentary trusts, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. As of December 31, 2021, the company operated through 56 banking facilities and 73 ATMs/ITMs. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.

About Freddie Mac

Federal Home Loan Mortgage Corporation operates in the secondary mortgage market in the United States. It operates through two segments, Single-Family and Multifamily. The Single-Family segment purchases, securitizes, and guarantees single-family loans; and manages single-family mortgage credit and market risk, as well as manages mortgage-related investments portfolio, single-family securitization activities, and treasury functions. This segment serves mortgage banking companies, commercial banks, regional banks, community banks, credit unions, housing finance agencies, savings institutions, and non-depository financial institutions. The Multifamily segment engages in the purchase, securitization, and guarantee of multifamily loans; issuance of multifamily K certificates; manages multifamily mortgage credit and market risk; and invests in multifamily loans and mortgage-related securities. It serves banks and other financial institutions, insurance companies, money managers, hedge funds, pension funds, state and local governments, and broker dealers. Federal Home Loan Mortgage Corporation incorporated in 1970 and is headquartered in McLean, Virginia.