Critical Review: HomeTrust Bancshares (NYSE:HTB) versus First Bank (NASDAQ:FRBA)

First Bank (NASDAQ:FRBA) and HomeTrust Bancshares (NYSE:HTB) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, profitability, dividends and earnings.

Volatility & Risk

First Bank has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, HomeTrust Bancshares has a beta of 0.81, suggesting that its share price is 19% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for First Bank and HomeTrust Bancshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Bank	0	2	3	0	2.60
HomeTrust Bancshares	0	3	2	1	2.67

First Bank presently has a consensus target price of $19.67, suggesting a potential upside of 1.64%. HomeTrust Bancshares has a consensus target price of $52.00, suggesting a potential upside of 10.96%. Given HomeTrust Bancshares’ stronger consensus rating and higher probable upside, analysts plainly believe HomeTrust Bancshares is more favorable than First Bank.

Profitability

This table compares First Bank and HomeTrust Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Bank	17.73%	9.58%	1.07%
HomeTrust Bancshares	23.19%	11.12%	1.49%

Earnings and Valuation

This table compares First Bank and HomeTrust Bancshares”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Bank	$149.77 million	3.24	$43.66 million	$1.71	11.32
HomeTrust Bancshares	$216.45 million	3.61	$64.36 million	$3.97	11.80

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

Insider & Institutional Ownership

64.9% of First Bank shares are owned by institutional investors. Comparatively, 60.9% of HomeTrust Bancshares shares are owned by institutional investors. 13.1% of First Bank shares are owned by insiders. Comparatively, 11.0% of HomeTrust Bancshares shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

First Bank pays an annual dividend of $0.48 per share and has a dividend yield of 2.5%. HomeTrust Bancshares pays an annual dividend of $0.60 per share and has a dividend yield of 1.3%. First Bank pays out 28.1% of its earnings in the form of a dividend. HomeTrust Bancshares pays out 15.1% 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.

Summary

HomeTrust Bancshares beats First Bank on 13 of the 17 factors compared between the two stocks.

About First Bank

First Bank provides various banking products and services to small to mid-sized businesses and individuals. The company accepts various deposits, including non-interest-bearing demand deposits, interest bearing demand accounts, money market accounts, savings accounts, and certificates of deposit, as well as commercial checking accounts. It also offers various loan products comprising commercial and industrial loans, which include line of credit, inventory, equipment, and short-term working capital financing; commercial real estate loans, such as owner-occupied, investor, construction and development, and multi-family loans; residential real estate loans comprising residential mortgages, first and second lien home equity loans, and revolving lines of credit; and consumer and other loans consists of auto, personal, traditional installment, and other loans. The company also provides electronic banking services, including Internet and mobile banking, electronic bill payment, and banking by phone; ATM and debit cards, and wire and ACH transfer services; remote deposit capture; and cash management services, as well as engages in the capital markets activities. It operates full-service branches in Cinnaminson, Delanco, Denville, Ewing, Fairfield, Flemington, Hamilton, Lawrence, Monroe, Pennington, Randolph, Somerset, and Williamstown, New Jersey; Doylestown, Trevose, Warminster, and West Chester, Paoli, Malvern, Coventry, Devon, Lionville, and Glen Mills Pennsylvania; and Palm Beach, Florida. First Bank was incorporated in 2007 and is headquartered in Hamilton, New Jersey.

About HomeTrust Bancshares

HomeTrust Bancshares, Inc. operates as the bank holding company for HomeTrust Bank that provides a range of retail and commercial banking products and services. Its deposit products include savings, money market, and demand accounts, as well as certificates of deposit for individuals, businesses, and nonprofit organizations. The company’s loan portfolio comprises retail consumer loans, such as one-to-four-family real estate lending, home equity lines of credit, construction and land/lots, indirect auto finance, and consumer lending; and commercial loans that include commercial real estate, construction and development, and commercial and industrial loans. It also provides small business administration loans, equipment finance leases, indirect automobile loans, and municipal leases; and cash management and online/mobile banking services. As of June 30, 2021, the company operated 41 offices in North Carolina, Upstate South Carolina, East Tennessee, and Southwest Virginia. HomeTrust Bancshares, Inc. was founded in 1926 and is headquartered in Asheville, North Carolina.