South Plains Financial (NASDAQ:SPFI – Get Free Report) and Peoples Bancorp of North Carolina (NASDAQ:PEBK – Get Free Report) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, risk, valuation, profitability, analyst recommendations, institutional ownership and dividends.
Profitability
This table compares South Plains Financial and Peoples Bancorp of North Carolina’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| South Plains Financial | 16.53% | 11.42% | 1.09% |
| Peoples Bancorp of North Carolina | 15.80% | 13.85% | 1.00% |
Dividends
South Plains Financial pays an annual dividend of $0.56 per share and has a dividend yield of 1.6%. Peoples Bancorp of North Carolina pays an annual dividend of $0.76 per share and has a dividend yield of 3.0%. South Plains Financial pays out 20.8% of its earnings in the form of a dividend. Peoples Bancorp of North Carolina pays out 25.6% 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. Peoples Bancorp of North Carolina has increased its dividend for 11 consecutive years. Peoples Bancorp of North Carolina is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| South Plains Financial | 0 | 0 | 3 | 0 | 3.00 |
| Peoples Bancorp of North Carolina | 0 | 0 | 0 | 0 | N/A |
South Plains Financial presently has a consensus target price of $34.33, suggesting a potential upside of 1.13%. Given South Plains Financial’s higher possible upside, research analysts plainly believe South Plains Financial is more favorable than Peoples Bancorp of North Carolina.
Institutional and Insider Ownership
55.0% of South Plains Financial shares are held by institutional investors. Comparatively, 43.8% of Peoples Bancorp of North Carolina shares are held by institutional investors. 25.4% of South Plains Financial shares are held by company insiders. Comparatively, 16.9% of Peoples Bancorp of North Carolina shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Risk and Volatility
South Plains Financial has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Peoples Bancorp of North Carolina has a beta of 0.57, suggesting that its stock price is 43% less volatile than the S&P 500.
Valuation and Earnings
This table compares South Plains Financial and Peoples Bancorp of North Carolina”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| South Plains Financial | $291.26 million | 1.91 | $62.74 million | $2.69 | 12.62 |
| Peoples Bancorp of North Carolina | $94.78 million | 1.46 | $15.55 million | $2.97 | 8.54 |
South Plains Financial has higher revenue and earnings than Peoples Bancorp of North Carolina. Peoples Bancorp of North Carolina is trading at a lower price-to-earnings ratio than South Plains Financial, indicating that it is currently the more affordable of the two stocks.
Summary
South Plains Financial beats Peoples Bancorp of North Carolina on 12 of the 16 factors compared between the two stocks.
About South Plains Financial
South Plains Financial, Inc. operates as a bank holding company for City Bank that provides commercial and consumer financial services to small and medium-sized businesses and individuals. The company operates through two segments, Banking and Insurance. It offers deposit products, including demand deposit accounts, interest-bearing products, savings accounts, and certificate of deposits. The company also provides commercial real estate loans; general and specialized commercial loans, including agricultural production and real estate, energy, finance, investment, and insurance loans, as well as loans to goods, services, restaurant and retail, construction, and other industries; residential construction loans; and 1-4 family residential loans, auto loans, and other loans for recreational vehicles or other purposes. In addition, it offers crop insurance products; trust products and services; investment services; mortgage banking services; online and mobile banking services; and debit and credit cards. The company was founded in 1941 and is headquartered in Lubbock, Texas.
About Peoples Bancorp of North Carolina
Peoples Bancorp of North Carolina, Inc. operates as the bank holding company for Peoples Bank that provides various banking products and services for individuals and small-to medium-sized businesses. It offers checking, savings, money market, and retirement accounts; certificates of deposits; and credit and debit cards. The company also originates commercial real estate loans, commercial loans, construction and land development loans, and residential mortgage loans; and individual taxpayer identification number mortgage loans, as well as agricultural loans. In addition, it provides investment counseling and non-deposit investment products, such as stocks, bonds, mutual funds, tax deferred annuities, and related brokerage services; and real estate appraisal and brokerage services. Further, the company operates as a clearing-house for the provision of appraisal services for community banks; and acquires, manages, and disposes real property, other collateral, and other assets obtained in the ordinary course of collecting debts. Peoples Bancorp of North Carolina, Inc. was founded in 1912 and is headquartered in Newton, North Carolina.
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