Head-To-Head Review: Southside Bancshares (NYSE:SBSI) and Princeton Bancorp (NASDAQ:BPRN)

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

Risk and Volatility

Southside Bancshares has a beta of 0.58, indicating that its share price is 42% less volatile than the S&P 500. Comparatively, Princeton Bancorp has a beta of 0.47, indicating that its share price is 53% less volatile than the S&P 500.

Insider and Institutional Ownership

55.7% of Southside Bancshares shares are held by institutional investors. Comparatively, 43.4% of Princeton Bancorp shares are held by institutional investors. 5.1% of Southside Bancshares shares are held by insiders. Comparatively, 23.1% of Princeton Bancorp shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Southside Bancshares and Princeton Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Southside Bancshares	$248.21 million	3.83	$69.18 million	$2.54	12.54
Princeton Bancorp	$139.02 million	2.15	$18.61 million	$3.80	11.54

Southside Bancshares has higher revenue and earnings than Princeton Bancorp. Princeton 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.

Dividends

Southside Bancshares pays an annual dividend of $1.48 per share and has a dividend yield of 4.6%. Princeton Bancorp pays an annual dividend of $1.40 per share and has a dividend yield of 3.2%. Southside Bancshares pays out 58.3% of its earnings in the form of a dividend. Princeton Bancorp pays out 36.8% 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 raised 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.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Southside Bancshares and Princeton Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southside Bancshares	1	5	1	0	2.00
Princeton Bancorp	0	2	1	1	2.75

Southside Bancshares presently has a consensus target price of $34.75, suggesting a potential upside of 9.07%. Princeton Bancorp has a consensus target price of $37.50, suggesting a potential downside of 14.45%. Given Southside Bancshares’ higher probable upside, equities research analysts plainly believe Southside Bancshares is more favorable than Princeton Bancorp.

Profitability

This table compares Southside Bancshares and Princeton 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%
Princeton Bancorp	18.99%	9.48%	1.15%

Summary

Southside Bancshares beats Princeton Bancorp on 10 of the 17 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 Princeton Bancorp

Princeton Bancorp, Inc. operates as the bank holding company for The Bank of Princeton that provides various banking products and services. It accepts various deposit products, including checking, savings, attorney trust, and money market accounts, as well as certificates of deposit. The company also offers traditional retail banking services, one-to-four-family residential mortgage loans, multi-family and commercial mortgage loans, construction loans, and commercial business loans, as well as consumer loans, including home equity loans and lines of credit. In addition, it provides debit and credit cards, and money orders, direct deposit, automated teller machines, cashier's checks, safe deposit boxes, online banking, wire transfers, night depository, remote deposit capture, bank-by-mail, online, and automated telephone banking services, as well as payroll-related services and merchant credit card processing services. Further, the company offers full on-line statements, on-line bill payment, account inquiries, mobile banking, transaction histories and details, and account-to-account transfer services. Princeton Bancorp, Inc. was founded in 2007 and is headquartered in Princeton, New Jersey.