Southern First Bancshares (NASDAQ: SFST) and Macatawa Bank (NASDAQ:MCBC) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, profitability, valuation and earnings.
Insider & Institutional Ownership
70.0% of Southern First Bancshares shares are held by institutional investors. Comparatively, 29.4% of Macatawa Bank shares are held by institutional investors. 12.9% of Southern First Bancshares shares are held by insiders. Comparatively, 8.6% of Macatawa Bank shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Macatawa Bank pays an annual dividend of $0.24 per share and has a dividend yield of 2.3%. Southern First Bancshares does not pay a dividend.
This is a breakdown of recent ratings and price targets for Southern First Bancshares and Macatawa Bank, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Southern First Bancshares||0||1||2||0||2.67|
Southern First Bancshares currently has a consensus target price of $38.67, suggesting a potential downside of 12.81%. Macatawa Bank has a consensus target price of $10.50, suggesting a potential upside of 1.94%. Given Macatawa Bank’s higher probable upside, analysts plainly believe Macatawa Bank is more favorable than Southern First Bancshares.
Risk & Volatility
Southern First Bancshares has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500. Comparatively, Macatawa Bank has a beta of 0.55, suggesting that its stock price is 45% less volatile than the S&P 500.
Earnings & Valuation
This table compares Southern First Bancshares and Macatawa Bank’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Southern First Bancshares||$70.54 million||4.63||$13.04 million||$1.94||22.86|
|Macatawa Bank||$75.10 million||4.67||$16.29 million||N/A||N/A|
Macatawa Bank has higher revenue and earnings than Southern First Bancshares.
This table compares Southern First Bancshares and Macatawa Bank’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Southern First Bancshares||18.49%||9.43%||0.84%|
Macatawa Bank beats Southern First Bancshares on 8 of the 14 factors compared between the two stocks.
About Southern First Bancshares
Southern First Bancshares, Inc. is a bank holding company that owns the capital stock of Southern First Bank (the Bank), a South Carolina state bank, and all of the stock of Greenville First Statutory Trust I and II (the Trusts). The Bank is a commercial bank with approximately nine retail offices located in Greenville, Columbia and Charleston, South Carolina. The Bank is primarily engaged in the business of accepting demand deposits and savings deposits insured by the Federal Deposit Insurance Corporation (the FDIC) and providing commercial, consumer and mortgage loans to the public. In addition to deposit and loan services, the Company offers other bank services, such as Internet banking, cash management services, safe deposit boxes, direct deposit and automatic drafts for various accounts. The Bank offers a range of lending services, including real estate, commercial, and equity-line consumer loans to individuals and small- to medium-sized businesses, and professional firms.
About Macatawa Bank
Macatawa Bank Corporation is a bank holding company. The Company, through its subsidiary, Macatawa Bank (the Bank), offers a range of commercial and personal banking services, including checking, savings and certificates of deposit accounts, cash management, safe deposit boxes, trust services and commercial, mortgage and consumer loans. The Bank is a Michigan chartered bank with depository accounts insured by the Federal Deposit Insurance Corporation. Its other services include automated teller machines (ATMs), Internet banking, telephone banking and debit cards. The Bank provides various brokerage services, including discount brokerage through Infinex, personal financial planning and consultation regarding mutual funds. As of December 31, 2016, the Bank operated 26 full service branch offices providing a range of commercial and consumer banking and trust services in Kent County, Ottawa County, and northern Allegan County, Michigan.
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