Head-To-Head Analysis: FB Financial (NYSE:FBK) versus First Business Financial Services (NASDAQ:FBIZ)

FB Financial (NYSE:FBK) and First Business Financial Services (NASDAQ:FBIZ) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, earnings, valuation, institutional ownership, analyst recommendations, dividends and risk.

Analyst Ratings

This is a breakdown of recent ratings for FB Financial and First Business Financial Services, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FB Financial	1	3	1	0	2.00
First Business Financial Services	0	0	4	0	3.00

FB Financial presently has a consensus price target of $50.20, suggesting a potential upside of 6.74%. First Business Financial Services has a consensus price target of $58.75, suggesting a potential upside of 20.00%. Given First Business Financial Services’ stronger consensus rating and higher probable upside, analysts plainly believe First Business Financial Services is more favorable than FB Financial.

Volatility & Risk

FB Financial has a beta of 1.15, meaning that its share price is 15% more volatile than the S&P 500. Comparatively, First Business Financial Services has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500.

Dividends

FB Financial pays an annual dividend of $0.76 per share and has a dividend yield of 1.6%. First Business Financial Services pays an annual dividend of $1.16 per share and has a dividend yield of 2.4%. FB Financial pays out 30.8% of its earnings in the form of a dividend. First Business Financial Services pays out 22.2% 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 Business Financial Services has increased its dividend for 13 consecutive years. First Business Financial Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

65.4% of FB Financial shares are held by institutional investors. Comparatively, 60.1% of First Business Financial Services shares are held by institutional investors. 1.7% of FB Financial shares are held by insiders. Comparatively, 6.3% of First Business Financial Services shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares FB Financial and First Business Financial Services”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FB Financial	$457.74 million	4.80	$116.04 million	$2.47	19.04
First Business Financial Services	$153.46 million	2.65	$44.24 million	$5.22	9.38

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

Profitability

This table compares FB Financial and First Business Financial Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FB Financial	15.18%	10.43%	1.25%
First Business Financial Services	16.86%	14.33%	1.16%

Summary

First Business Financial Services beats FB Financial on 10 of the 17 factors compared between the two stocks.

About FB Financial

FB Financial Corporation operates as a bank holding company for FirstBank that provides a suite of commercial and consumer banking services to businesses, professionals, and individuals. The company operates in segments, such as Banking and Mortgage. It offers checking, demand, money market, and savings accounts; deposit and lending products and services to corporate, commercial, and consumer customers; and time deposits and certificates of deposits, as well as residential mortgage loans. The company also provides owner-occupied and non-owner-occupied real estate commercial, residential real estate 1-4 family mortgage, multi-family residential, commercial and industrial, construction, land acquisition, residential lines of credit, and land development loans; and consumer and other loans, such as car, boat, and other recreational vehicle loans, as well as manufactured homes without real estate and personal lines of credit. In addition, the company offers mortgage banking services through its bank branch network and mortgage banking offices in the southeastern United States; direct-to-consumer internet delivery channel; and trust, insurance, and investment services, as well as online and mobile banking services. The company operates full-service bank branches and limited-service branches locations throughout Tennessee, Nashville, Chattanooga, Knoxville, Memphis, Jackson, Birmingham, Florence, Huntsville, Alabama, Bowling Green, and Kentucky; and mortgage offices throughout the southeastern United States. The company was formerly known as First South Bancorp, Inc. and changed its name to FB Financial Corporation in 2016. FB Financial Corporation was founded in 1906 and is headquartered in Nashville, Tennessee.

About First Business Financial Services

First Business Financial Services, Inc. operates as the bank holding company for First Business Bank that provides commercial banking products and services for small and medium-sized businesses, business owners, executives, professionals, and high net worth individuals in Wisconsin, Kansas, and Missouri. The company offers real estate lending, commercial and industrial lending, asset-based lending, accounts receivable financing, equipment financing loans and leases, floorplan financing, vendor financing, small business administration lending and servicing, treasury management solutions, and company retirement services. It also provides private wealth management for individuals, including creating and executing asset allocation strategies, trust and estate administration, financial planning, investment management, and access to brokerage and custody-only services. In addition, the company offers bank consulting consisting of investment portfolio administrative and asset liability management services, and commercial deposit accounts. The company was founded in 1909 and is headquartered in Madison, Wisconsin.