First Community Bancshares (NASDAQ:FCBC) & Bank of N.T. Butterfield & Son (NYSE:NTB) Financial Review

Bank of N.T. Butterfield & Son (NYSE:NTB) and First Community Bancshares (NASDAQ:FCBC) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, dividends and risk.

Valuation & Earnings

This table compares Bank of N.T. Butterfield & Son and First Community Bancshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank of N.T. Butterfield & Son	$800.02 million	3.16	$231.94 million	$5.69	10.59
First Community Bancshares	$185.42 million	5.01	$48.79 million	$3.17	15.50

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

Dividends

Bank of N.T. Butterfield & Son pays an annual dividend of $2.00 per share and has a dividend yield of 3.3%. First Community Bancshares pays an annual dividend of $1.32 per share and has a dividend yield of 2.7%. Bank of N.T. Butterfield & Son pays out 35.1% of its earnings in the form of a dividend. First Community Bancshares pays out 41.6% 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. First Community Bancshares has raised its dividend for 13 consecutive years. Bank of N.T. Butterfield & Son is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

62.7% of Bank of N.T. Butterfield & Son shares are held by institutional investors. Comparatively, 35.0% of First Community Bancshares shares are held by institutional investors. 1.2% of Bank of N.T. Butterfield & Son shares are held by company insiders. Comparatively, 3.7% of First Community Bancshares shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Bank of N.T. Butterfield & Son and First Community Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank of N.T. Butterfield & Son	29.34%	22.43%	1.79%
First Community Bancshares	28.84%	10.67%	1.61%

Risk & Volatility

Bank of N.T. Butterfield & Son has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500. Comparatively, First Community Bancshares has a beta of 0.47, suggesting that its share price is 53% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Bank of N.T. Butterfield & Son and First Community Bancshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank of N.T. Butterfield & Son	0	3	0	1	2.50
First Community Bancshares	0	2	1	0	2.33

Bank of N.T. Butterfield & Son currently has a consensus price target of $63.50, indicating a potential upside of 5.37%. Given Bank of N.T. Butterfield & Son’s stronger consensus rating and higher possible upside, research analysts clearly believe Bank of N.T. Butterfield & Son is more favorable than First Community Bancshares.

Summary

Bank of N.T. Butterfield & Son beats First Community Bancshares on 13 of the 18 factors compared between the two stocks.

About Bank of N.T. Butterfield & Son

The Bank of N.T. Butterfield & Son Ltd. provides community banking and wealth management business. The firm operates through the following geographical segments: Bermuda, the Cayman Islands, Channel Islands and the UK, and Other. The Bermuda and Cayman segments offer retail banking and wealth management. The Channel Islands and the UK segment refers to the retail and corporate banking and wealth management. The Other segment includes operations in the jurisdictions of The Bahamas, Canada, Mauritius, Singapore and Switzerland. The company was founded in 1858 and is headquartered in Hamilton, Bermuda.

About First Community Bancshares

First Community Bankshares, Inc. operates as the financial holding company for First Community Bank that provides various banking products and services. It offers demand deposit accounts, savings and money market accounts, certificates of deposit, and individual retirement plans; and commercial, consumer real estate, and consumer and other loans. The company also provides trust management, estate administration, and investment advisory services; and investment management services. It serves individuals and businesses across various industries, such as education, government, and health services; coal mining and gas extraction; retail trade; construction; manufacturing; tourism; and transportation. The company operates through branches in West Virginia, Virginia, North Carolina, and Tennessee. Community Bankshares, Inc. was founded in 1874 and is headquartered in Bluefield, Virginia.