Critical Survey: Independent Bank (NASDAQ:INDB) vs. HBT Financial (NASDAQ:HBT)

HBT Financial (NASDAQ:HBT) and Independent Bank (NASDAQ:INDB) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, risk, institutional ownership, earnings, profitability, valuation and analyst recommendations.

Risk & Volatility

HBT Financial has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500. Comparatively, Independent Bank has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500.

Institutional & Insider Ownership

78.6% of HBT Financial shares are owned by institutional investors. Comparatively, 83.4% of Independent Bank shares are owned by institutional investors. 59.7% of HBT Financial shares are owned by insiders. Comparatively, 0.8% of Independent Bank shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares HBT Financial and Independent Bank”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HBT Financial	$287.27 million	2.81	$71.78 million	$2.48	10.37
Independent Bank	$980.77 million	3.70	$192.08 million	$4.11	17.81

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

Dividends

HBT Financial pays an annual dividend of $0.84 per share and has a dividend yield of 3.3%. Independent Bank pays an annual dividend of $2.36 per share and has a dividend yield of 3.2%. HBT Financial pays out 33.9% of its earnings in the form of a dividend. Independent Bank pays out 57.4% 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. HBT Financial has increased its dividend for 5 consecutive years and Independent Bank has increased its dividend for 15 consecutive years. HBT Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of current ratings and price targets for HBT Financial and Independent Bank, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HBT Financial	0	4	3	0	2.43
Independent Bank	0	4	1	1	2.50

HBT Financial presently has a consensus price target of $28.50, suggesting a potential upside of 10.85%. Independent Bank has a consensus price target of $76.80, suggesting a potential upside of 4.93%. Given HBT Financial’s higher possible upside, analysts clearly believe HBT Financial is more favorable than Independent Bank.

Profitability

This table compares HBT Financial and Independent Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HBT Financial	26.64%	13.81%	1.57%
Independent Bank	16.64%	7.19%	1.08%

Summary

Independent Bank beats HBT Financial on 10 of the 18 factors compared between the two stocks.

About HBT Financial

HBT Financial, Inc. operates as the bank holding company for Heartland Bank and Trust Company that provides business, commercial, and retail banking products and services to individuals, businesses, and municipal entities in Central and Northeastern Illinois, and Eastern Iowa. The company's deposits accounts consist of noninterest-bearing demand deposits, interest-bearing transaction accounts, money market accounts, savings accounts, certificates of deposits, health savings accounts, and individual retirement accounts. Its loan offering comprises owner and non-owner occupied commercial real estate; construction and land development and multi-family; commercial and industrial; agricultural and farmland; and one-to-four family residential loans, as well as municipal, consumer, and other loans. The company also offers wealth management services, including financial planning to consumers, trusts, and estates; trustee and custodial; investment management; corporate retirement plan consulting and administration; and retail brokerage services. In addition, it provides farmland management, and farmland sales and services; commercial checking accounts; and treasury management services, as well as originates and sells residential mortgage loans. Further, the company offers digital banking services, such as online and mobile banking, and digital payment services, as well as personal financial management tools. The company was formerly known as Heartland Bancorp, Inc. and changed its name to HBT Financial, Inc. in September 2019. HBT Financial, Inc. was founded in 1920 and is headquartered in Bloomington, Illinois.

About Independent Bank

Independent Bank Corp. operates as the bank holding company for Rockland Trust Company that provides commercial banking products and services to individuals and small-to-medium sized businesses in the United States. The company provides interest checking, money market, and savings accounts, as well as demand deposits and time certificates of deposit. It offers commercial real estate and construction, commercial and industrial, small business, secured and unsecured commercial, and consumer real estate loans; term loans and revolving/nonrevolving lines of credit; overdraft protection and letters of credit; and residential mortgages and home equity loans and lines. In addition, the company provides cash management services, such as ACH transaction processing, positive pay, and remote deposit services; investment management and trust services to individuals, institutions, small businesses, and charitable institutions; mobile, online, and telephone banking; estate settlement, financial planning, tax services, and other services; automated teller machines; debit and credit cards; and mutual fund and unit investment trust shares, third party model portfolios, general securities, fixed and variable annuities, and life insurance products, as well as advisory platforms. Further, it invests in low-income housing tax credit projects; holds, maintains, and disposes foreclosed properties; and operates as an investment advisor. Independent Bank Corp. was founded in 1907 and is headquartered in Rockland, Massachusetts.