Comparing First Community Bancshares (NASDAQ:FCBC) & Hilltop (NYSE:HTH)

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

Volatility & Risk

First Community Bancshares has a beta of 0.48, suggesting that its stock price is 52% less volatile than the S&P 500. Comparatively, Hilltop has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.

Earnings and Valuation

This table compares First Community Bancshares and Hilltop”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Community Bancshares	$185.42 million	4.48	$48.79 million	$2.65	16.42
Hilltop	$1.63 billion	1.36	$165.59 million	$2.64	14.31

Hilltop has higher revenue and earnings than First Community Bancshares. Hilltop 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

First Community Bancshares pays an annual dividend of $1.24 per share and has a dividend yield of 2.8%. Hilltop pays an annual dividend of $0.80 per share and has a dividend yield of 2.1%. First Community Bancshares pays out 46.8% of its earnings in the form of a dividend. Hilltop pays out 30.3% 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. First Community Bancshares has increased its dividend for 13 consecutive years and Hilltop has increased its dividend for 8 consecutive years. First Community Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

35.0% of First Community Bancshares shares are held by institutional investors. Comparatively, 57.1% of Hilltop shares are held by institutional investors. 3.7% of First Community Bancshares shares are held by company insiders. Comparatively, 29.9% of Hilltop shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares First Community Bancshares and Hilltop’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Community Bancshares	25.89%	10.53%	1.66%
Hilltop	10.13%	7.32%	1.03%

Analyst Ratings

This is a summary of recent ratings and price targets for First Community Bancshares and Hilltop, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Community Bancshares	0	0	1	0	3.00
Hilltop	0	2	1	1	2.75

Hilltop has a consensus target price of $37.50, indicating a potential downside of 0.71%. Given Hilltop’s higher probable upside, analysts clearly believe Hilltop is more favorable than First Community Bancshares.

Summary

First Community Bancshares beats Hilltop on 9 of the 17 factors compared between the two stocks.

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.

About Hilltop

Hilltop Holdings Inc. provides business and consumer banking services. It operates through three segments: Banking, Broker-Dealer, and Mortgage Origination. The Banking segment offers savings, checking, interest-bearing checking, and money market accounts; certificates of deposit; lines and letters of credit, home improvement and equity loans, loans for purchasing and carrying securities, term, agricultural and commercial real estate, equipment loans, and other lending products; and mortgage, commercial and industrial loans, and term and construction finance. It also provides treasury management, asset management, check cards, safe deposit boxes, online banking, bill pay, and overdraft privilege services; and estate planning, management and administration, investment portfolio management, employee benefit accounts, and individual retirement accounts services, as well as automated teller machines. The Broker-Dealer segment offers public finance services that assist public entities in originating, syndicating, and distributing securities of municipalities and political subdivisions; specialized advisory and investment banking services; advice and guidance to arbitrage rebate compliance, portfolio management, and local government investment pool administration; advisory services and products for derivatives and commodities; agricultural insurance; and sells, trades in, and underwrites U.S. government and government agency bonds, corporate bonds, and municipal bonds; mortgage-backed, asset-backed, and commercial mortgage-backed securities and structured products; and provides asset and liability management advisory, clearing, retail, and securities lending services. The Mortgage Origination segment offers fixed and adjustable rate mortgages, jumbo, new construction, Federal Housing Administration, Veterans Affairs, and United States Department of Agriculture loans. Hilltop Holdings Inc. was incorporated in 1998 and is based in Dallas, Texas.