Valley National Bancorp (NASDAQ:VLY) vs. Southside Bancshares (NYSE:SBSI) Head-To-Head Analysis

Southside Bancshares (NYSE:SBSI) and Valley National Bancorp (NASDAQ:VLY) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, risk, valuation, dividends and analyst recommendations.

Profitability

This table compares Southside Bancshares and Valley National Bancorp’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%
Valley National Bancorp	19.49%	9.13%	1.06%

Insider and Institutional Ownership

55.7% of Southside Bancshares shares are held by institutional investors. Comparatively, 61.0% of Valley National Bancorp shares are held by institutional investors. 5.1% of Southside Bancshares shares are held by company insiders. Comparatively, 1.1% of Valley National Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Southside Bancshares pays an annual dividend of $1.48 per share and has a dividend yield of 4.7%. Valley National Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 3.4%. Southside Bancshares pays out 58.3% of its earnings in the form of a dividend. Valley National Bancorp pays out 37.3% 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. Southside Bancshares has increased its dividend for 30 consecutive years. Southside Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Southside Bancshares and Valley National Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Southside Bancshares	$419.03 million	2.23	$69.18 million	$2.54	12.32
Valley National Bancorp	$3.49 billion	2.07	$597.98 million	$1.18	11.12

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

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Southside Bancshares and Valley National Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southside Bancshares	1	4	1	0	2.00
Valley National Bancorp	0	4	10	3	2.94

Southside Bancshares currently has a consensus price target of $34.75, indicating a potential upside of 11.08%. Valley National Bancorp has a consensus price target of $16.36, indicating a potential upside of 24.67%. Given Valley National Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe Valley National Bancorp is more favorable than Southside Bancshares.

Risk & Volatility

Southside Bancshares has a beta of 0.58, suggesting that its share price is 42% less volatile than the S&P 500. Comparatively, Valley National Bancorp has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500.

Summary

Valley National Bancorp beats Southside Bancshares on 10 of the 18 factors compared between the two stocks.

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 Valley National Bancorp

Valley National Bancorp operates as the holding company for Valley National Bank that provides various commercial, private banking, retail, insurance, and wealth management financial services products. It operates through Consumer Banking, Commercial Banking, and Treasury and Corporate other segments. The company offers non-interest bearing, savings, NOW, money market, and time deposit accounts; commercial and industrial, commercial real estate, residential mortgage, and automobile loans; loans secured by the cash surrender value of life insurance; home equity loans and lines of credit; automobile financing; and secured and unsecured other consumer loans. It also invests in various securities and interest-bearing deposits with other banks; and provides international banking services, such as standby and documentary letters of credit, and related products, as well as foreign exchange transactions, documentary collections, and foreign wire transfers services. In addition, the company offers investment services for individuals and small to medium sized businesses; and trusts investment strategies designed for various investment profiles and objectives. Further, it provides trust services, such as living and testamentary trusts, investment management, custodial and escrow services, and estate administration to individuals; tax credit advisory services; brokerage services; property and casualty, life, health, and title insurance agency services; and health care equipment lending and other commercial equipment leasing services, as well as owns real estate related investments. Additionally, the company offers online, mobile, and telephone banking services; receivable, payment, and security solution, merchant, payroll processing, and liquidity services; credit cards; and drive-in and night deposit, automated teller machine, remote deposit capture, and safe deposit facility services. Valley National Bancorp was founded in 1927 and is headquartered in Morristown, New Jersey.