Head-To-Head Analysis: S&T Bancorp (NASDAQ:STBA) versus Fannie Mae (OTCMKTS:FNMA)

Fannie Mae (OTCMKTS:FNMA) and S&T Bancorp (NASDAQ:STBA) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, institutional ownership, profitability, dividends, risk and analyst recommendations.

Profitability

This table compares Fannie Mae and S&T Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fannie Mae	4.59%	-76.66%	0.51%
S&T Bancorp	24.51%	9.74%	1.42%

Earnings & Valuation

This table compares Fannie Mae and S&T Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fannie Mae	$159.17 billion	0.03	$14.36 billion	$0.04	101.00
S&T Bancorp	$568.51 million	3.02	$134.23 million	$3.76	12.96

Fannie Mae has higher revenue and earnings than S&T Bancorp. S&T Bancorp is trading at a lower price-to-earnings ratio than Fannie Mae, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

0.0% of Fannie Mae shares are owned by institutional investors. Comparatively, 65.2% of S&T Bancorp shares are owned by institutional investors. 1.0% of Fannie Mae shares are owned by company insiders. Comparatively, 1.2% of S&T Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

Fannie Mae has a beta of 1.68, indicating that its share price is 68% more volatile than the S&P 500. Comparatively, S&T Bancorp has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Fannie Mae and S&T Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fannie Mae	1	4	0	1	2.17
S&T Bancorp	0	6	2	0	2.25

Fannie Mae presently has a consensus price target of $9.70, indicating a potential upside of 140.10%. S&T Bancorp has a consensus price target of $51.60, indicating a potential upside of 5.87%. Given Fannie Mae’s higher probable upside, analysts plainly believe Fannie Mae is more favorable than S&T Bancorp.

Summary

S&T Bancorp beats Fannie Mae on 9 of the 15 factors compared between the two stocks.

About Fannie Mae

Federal National Mortgage Association provides financing solutions for mortgages in the United States. It operates through two segments, Single-Family and Multifamily. The Single-Family segment securitizes and purchases single-family fixed-rate or adjustable-rate, first-lien mortgage loans, or mortgage-related securities backed by these loans; and loans that are insured by Federal Housing Administration, loans guaranteed by the Department of Veterans Affairs and Rural Development Housing and Community Facilities Program of the U.S. Department of Agriculture, manufactured housing mortgage loans, and other mortgage-related securities. The Multifamily segment securitizes multifamily mortgage loans into Fannie Mae mortgage backed securities (MBS); purchases multifamily mortgage loans; and provides credit enhancement for bonds issued by state and local housing finance authorities to finance multifamily housing. This segment also issues structured MBS backed by Fannie Mae multifamily MBS; buys and sells multifamily agency mortgage-backed securities; and invests in low-income housing tax credit multifamily projects. Federal National Mortgage Association was founded in 1938 and is based in Washington, the District of Columbia.

About S&T Bancorp

S&T Bancorp, Inc. is a bank holding company, which engages in the provision of consumer, commercial, and small business banking services. It operates through the following segments: Commercial Real Estate, Commercial and Industrial, Commercial Construction, Business Banking, Consumer Real Estate, and Other Consumer. The Commercial Real Estate segment includes both owner-occupied properties and investment properties for various purposes such as hotels, retail, multifamily and health care. The Commercial and Industrial segment focuses on the companies or manufacturers for the purpose of production, operating capacity, accounts receivable, inventory or equipment financing. The Commercial Construction segment refers to the finance construction of buildings or other structures, as well as to finance the acquisition and development of raw land for various purposes. The Business Banking segment is made to small businesses that are standard, non-complex products evaluated through a streamlined credit approval process that has been designed to maximize efficiency while maintaining high credit quality standards. The Consumer Real Estate segment offers first and second liens such as 1-4 family residential mortgages, home equity loans and home equity lines of credit. The Other Consumer segment consists of individuals that may be secured by assets other than 1-4 family residences, as well as unsecured loans. The company was founded on March 17, 1983 and is headquartered in Indiana, PA.