Texas Community Bancshares (NASDAQ:TCBS) and Community Trust Bancorp (NASDAQ:CTBI) Financial Comparison

Community Trust Bancorp (NASDAQ:CTBI) and Texas Community Bancshares (NASDAQ:TCBS) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, risk and institutional ownership.

Risk & Volatility

Community Trust Bancorp has a beta of 0.54, suggesting that its share price is 46% less volatile than the S&P 500. Comparatively, Texas Community Bancshares has a beta of -0.03, suggesting that its share price is 103% less volatile than the S&P 500.

Dividends

Community Trust Bancorp pays an annual dividend of $2.12 per share and has a dividend yield of 3.0%. Texas Community Bancshares pays an annual dividend of $0.24 per share and has a dividend yield of 1.4%. Community Trust Bancorp pays out 37.1% of its earnings in the form of a dividend. Texas Community Bancshares pays out 22.0% 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. Community Trust Bancorp has raised its dividend for 44 consecutive years and Texas Community Bancshares has raised its dividend for 1 consecutive years. Community Trust Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

60.2% of Community Trust Bancorp shares are held by institutional investors. Comparatively, 15.8% of Texas Community Bancshares shares are held by institutional investors. 2.6% of Community Trust Bancorp shares are held by insiders. Comparatively, 15.3% of Texas Community Bancshares shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Community Trust Bancorp and Texas Community Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Community Trust Bancorp	24.85%	12.27%	1.56%
Texas Community Bancshares	11.79%	5.66%	0.70%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Community Trust Bancorp and Texas Community Bancshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Community Trust Bancorp	0	2	1	1	2.75
Texas Community Bancshares	0	1	0	0	2.00

Community Trust Bancorp currently has a consensus target price of $68.50, indicating a potential downside of 4.34%. Given Community Trust Bancorp’s stronger consensus rating and higher possible upside, research analysts clearly believe Community Trust Bancorp is more favorable than Texas Community Bancshares.

Valuation and Earnings

This table compares Community Trust Bancorp and Texas Community Bancshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Community Trust Bancorp	$409.34 million	3.18	$98.06 million	$5.71	12.54
Texas Community Bancshares	$25.57 million	2.01	$2.84 million	$1.09	16.28

Community Trust Bancorp has higher revenue and earnings than Texas Community Bancshares. Community Trust Bancorp is trading at a lower price-to-earnings ratio than Texas Community Bancshares, indicating that it is currently the more affordable of the two stocks.

Summary

Community Trust Bancorp beats Texas Community Bancshares on 15 of the 18 factors compared between the two stocks.

About Community Trust Bancorp

Community Trust Bancorp, Inc. operates as the bank holding company for Community Trust Bank, Inc. that engages in the provision of commercial and personal banking, and trust and wealth management services to small and mid-sized communities in eastern, northeastern, central, and south-central Kentucky, as well as southern West Virginia, and northeastern Tennessee. The company accepts time and demand deposits, checking accounts, savings accounts and savings certificates, individual retirement accounts and Keogh plans, and money market accounts. Its loan portfolio includes commercial, construction, mortgage, and personal loans; lease-financing, lines of credit, revolving lines of credit, and term loans, as well as other specialized loans, including asset-based financing; residential and commercial real estate loans; and consumer loans. The company also provides cash management, renting safe deposit boxes, and funds transfer services; issues letters of credit; and acts as a trustee of personal trusts, executor of estates, trustee for employee benefit trusts, and paying agent for bond and stock issues, as well as an investment agent and depositor for securities. In addition, it offers securities brokerage services; debit cards; annuity and life insurance products; and repurchase agreements, as well as mobile, internet banking, and e-statement services. The company was founded in 1903 and is headquartered in Pikeville, Kentucky.

About Texas Community Bancshares

Texas Community Bancshares, Inc. operates as the bank holding company for Mineola Community Bank, S.S.B. that provides loans and banking services to consumers and commercial customers in Mineola, Texas and the surrounding area, and the Dallas Fort Worth Metroplex. It generates a selection of deposit accounts, including savings accounts, checking accounts, certificates of deposit, and individual retirement accounts. The company also originates primarily one- to four-family residential mortgage loans, commercial real estate loans, and construction and land loans; and car, boat, share, unsecured loans, etc., as well as agricultural loans, commercial loans, and consumer and other loans. In addition, it invests in securities; and offers sweep account, safe deposit boxes, e-statement, cards, online banking, and mobile banking services. Texas Community Bancshares, Inc. was founded in 1934 and is headquartered in Mineola, Texas.