Comparing Beacon Financial (NYSE:BBT) and United Bancorp (NASDAQ:UBCP)

United Bancorp (NASDAQ:UBCP) and Beacon Financial (NYSE:BBT) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.

Analyst Ratings

This is a summary of current recommendations and price targets for United Bancorp and Beacon Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Bancorp	0	1	0	0	2.00
Beacon Financial	0	4	3	0	2.43

Beacon Financial has a consensus target price of $32.75, suggesting a potential upside of 7.07%. Given Beacon Financial’s stronger consensus rating and higher probable upside, analysts clearly believe Beacon Financial is more favorable than United Bancorp.

Insider & Institutional Ownership

15.4% of United Bancorp shares are held by institutional investors. Comparatively, 83.1% of Beacon Financial shares are held by institutional investors. 13.9% of United Bancorp shares are held by insiders. Comparatively, 1.1% of Beacon Financial shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares United Bancorp and Beacon Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Bancorp	16.55%	11.53%	0.92%
Beacon Financial	17.33%	10.09%	1.13%

Volatility and Risk

United Bancorp has a beta of 0.3, suggesting that its share price is 70% less volatile than the S&P 500. Comparatively, Beacon Financial has a beta of 0.61, suggesting that its share price is 39% less volatile than the S&P 500.

Dividends

United Bancorp pays an annual dividend of $0.79 per share and has a dividend yield of 5.6%. Beacon Financial pays an annual dividend of $1.29 per share and has a dividend yield of 4.2%. United Bancorp pays out 61.2% of its earnings in the form of a dividend. Beacon Financial pays out 48.0% 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. United Bancorp has increased its dividend for 13 consecutive years. United Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares United Bancorp and Beacon Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Bancorp	$47.51 million	1.72	$7.75 million	$1.29	11.01
Beacon Financial	$882.68 million	2.90	$90.27 million	$2.69	11.37

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

Summary

Beacon Financial beats United Bancorp on 12 of the 17 factors compared between the two stocks.

About United Bancorp

United Bancorp, Inc. operates as the bank holding company for Unified Bank that provides commercial and retail banking services in Ohio. The company provides range of banking and financial services, which includes accepting demand, savings, and time deposits. It also offers commercial, real estate and consumer loans. United Bancorp, Inc. was founded in 1902 and is headquartered in Martins Ferry, Ohio.

About Beacon Financial

Truist Financial Corp. operates as a financial holding company, which engages in the provision of banking services to individuals, businesses and municipalities. The firm offers a variety of loans and lease financing to individuals and entities, including insurance premium financing, permanent commercial real estate financing arrangements, loan servicing for third-party investors, direct consumer finance loans to individuals, credit card lending, automobile financing and equipment financing. It also markets a range of other services, including deposits, life insurance, property and casualty insurance, health Truist Financial Corp. operates as a financial holding company. It engages in the provision of banking services to individuals, businesses and municipalities. The company operates through the following segments: Consumer Banking and Wealth; Corporate and Commercial Banking; and Insurance Holdings. The firm offers a variety of loans and lease financing to individuals and entities, including insurance premium financing, permanent commercial real estate financing arrangements, loan servicing for third-party investors, direct consumer finance loans to individuals, credit card lending, automobile financing and equipment financing. It also markets a range of other services, including deposits, life insurance, property and casualty insurance, health insurance and commercial general liability insurance on an agency basis and through a wholesale insurance brokerage operation, merchant services, trust and retirement services, comprehensive wealth advisory services, asset management and capital markets services. The company was founded on December 6, 2019 and is headquartered in Charlotte, NC. insurance and commercial general liability insurance on an agency basis and through a wholesale insurance brokerage operation, merchant services, trust and retirement services, comprehensive wealth advisory services, asset management and capital markets services. The company was founded on December 6, 2019 and is headquartered in Charlotte, NC.