Bancorp (NASDAQ:TBBK) and First Community (NASDAQ:FCCO) Critical Review

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

Volatility and Risk

First Community has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500. Comparatively, Bancorp has a beta of 1.25, indicating that its share price is 25% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
First Community	19.55%	13.73%	1.24%
Bancorp	27.72%	32.32%	2.50%

Institutional & Insider Ownership

61.3% of First Community shares are held by institutional investors. Comparatively, 96.2% of Bancorp shares are held by institutional investors. 8.8% of First Community shares are held by company insiders. Comparatively, 6.0% of Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares First Community and Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Community	$114.00 million	2.72	$19.20 million	$2.86	11.53
Bancorp	$879.70 million	2.17	$228.21 million	$5.32	8.79

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

Analyst Recommendations

This is a breakdown of current ratings and price targets for First Community and Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Community	0	0	2	0	3.00
Bancorp	0	3	4	1	2.75

First Community currently has a consensus price target of $37.50, suggesting a potential upside of 13.71%. Bancorp has a consensus price target of $67.75, suggesting a potential upside of 44.92%. Given Bancorp’s higher probable upside, analysts plainly believe Bancorp is more favorable than First Community.

Summary

Bancorp beats First Community on 11 of the 15 factors compared between the two stocks.

About First Community

First Community Corporation operates as the bank holding company for First Community Bank that provides various commercial and retail banking products and services to small-to-medium sized businesses, professionals, and individuals. The company operates through Commercial and Retail Banking, Mortgage Banking, and Investment Advisory and Non-Deposit segments. Its deposit products include checking, NOW, savings, and individual retirement accounts; and demand deposits, as well as other time deposits, such as daily money market accounts and longer-term certificates of deposit. The company's loan portfolio comprises commercial loans that include secured and unsecured loans for working capital, business expansion, and the purchase of equipment and machinery; consumer loans, including secured and unsecured loans for financing automobiles, home improvements, education, and personal investments; real estate construction and acquisition loans; and fixed and variable rate mortgage loans. It also provides online banking, internet banking, cash management, safe deposit boxes, direct deposit of payroll and social security checks, and automatic drafts for various accounts. In addition, the company offers non-deposit investment products and other investment brokerage services; VISA and MasterCard credit card services; investment advisory services; and insurance services. The company was incorporated in 1994 and is headquartered in Lexington, South Carolina.

About Bancorp

The Bancorp, Inc. operates as the bank holding company for The Bancorp Bank, National Association that provides banking products and services in the United States. It offers a range of deposit products and services, including checking, savings, time, money market, and commercial accounts; overdrafts; and certificates of deposit. The company also provides securities-backed lines of credit and insurance policy cash value-backed lines of credit; investor advisor financing; lease financing for commercial and government vehicle fleets, including trucks and other special purpose vehicles; commercial real estate bridge loans; and small business administration loans. In addition, it offers bill and other payment services; debit and prepaid card issuing services; card and bill payment, and automated clearing house processing services; and internet banking services. The company was incorporated in 1999 and is headquartered in Wilmington, Delaware.