Southern National Bancorp of Virginia (NASDAQ:SONA) and West Bancorporation (NASDAQ:WTBA) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, analyst recommendations, valuation and dividends.
Earnings and Valuation
This table compares Southern National Bancorp of Virginia and West Bancorporation’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Southern National Bancorp of Virginia||$133.11 million||2.83||$33.17 million||$1.48||10.40|
|West Bancorporation||$106.99 million||3.78||$28.69 million||$1.74||14.10|
Southern National Bancorp of Virginia pays an annual dividend of $0.40 per share and has a dividend yield of 2.6%. West Bancorporation pays an annual dividend of $0.88 per share and has a dividend yield of 3.6%. Southern National Bancorp of Virginia pays out 27.0% of its earnings in the form of a dividend. West Bancorporation pays out 50.6% 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. Southern National Bancorp of Virginia has increased its dividend for 1 consecutive years and West Bancorporation has increased its dividend for 1 consecutive years.
This table compares Southern National Bancorp of Virginia and West Bancorporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Southern National Bancorp of Virginia||17.12%||7.23%||0.94%|
Insider & Institutional Ownership
77.2% of Southern National Bancorp of Virginia shares are held by institutional investors. Comparatively, 39.7% of West Bancorporation shares are held by institutional investors. 5.9% of Southern National Bancorp of Virginia shares are held by company insiders. Comparatively, 3.5% of West Bancorporation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Risk and Volatility
Southern National Bancorp of Virginia has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500. Comparatively, West Bancorporation has a beta of 0.97, indicating that its stock price is 3% less volatile than the S&P 500.
This is a summary of current recommendations and price targets for Southern National Bancorp of Virginia and West Bancorporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Southern National Bancorp of Virginia||0||2||0||0||2.00|
Southern National Bancorp of Virginia currently has a consensus price target of $9.50, indicating a potential downside of 38.27%. West Bancorporation has a consensus price target of $17.50, indicating a potential downside of 28.66%. Given West Bancorporation’s higher probable upside, analysts plainly believe West Bancorporation is more favorable than Southern National Bancorp of Virginia.
About Southern National Bancorp of Virginia
Southern National Bancorp of Virginia, Inc. operates as the bank holding company for Sonabank that provides commercial banking services to individuals and small and medium sized businesses in the United States. Its deposit products include noninterest-bearing and interest-bearing checking, commercial checking, money market, and savings accounts, as well as certificates of deposit. The company's loan portfolio comprises commercial mortgage and non-mortgage loans, including commercial real estate loans, construction and permanent loans, development and builder loans, accounts receivable financing, lines of credit, equipment and vehicle loans, leasing, and commercial overdraft protection; construction loans for commercial, multifamily, and other non-residential properties; commercial business loans, such as lines of credit, revolving credit facilities, demand loans, term loans, equipment loans, small business administration loans, stand-by letters of credit, and unsecured loans; residential mortgage lending; and secured and unsecured consumer loans. It also offers cash management services comprising investment/sweep, zero balance, and controlled disbursement accounts; and wire transfer, employer/payroll processing, night depository, lockbox, depository transfer, merchant, ACH origination, check 21 processing, and asset based lending, as well as mobile banking application services for personal and business accounts. In addition, the company provides other consumer/retail products and services that include debit and credit cards, ATM services, travelers' checks, notary services, and online banking services. As of December 31, 2019, it operated forty-five full-service branches, which included thirty-eight in Virginia and seven in Maryland. Southern National Bancorp of Virginia, Inc. was founded in 2004 and is based in McLean, Virginia.
About West Bancorporation
West Bancorporation, Inc. operates as the financial holding company for West Bank that provides community banking and trust services to individuals and small- to medium-sized businesses in the United States. It accepts various deposit products, including checking, savings, and money market accounts, as well as time certificates of deposit. The company also provides loan products comprising commercial real estate loans, construction and land development loans, commercial lines of credit, and commercial term loans; consumer loans, including loans extended to individuals for household, family, and other personal expenditures not secured by real estate; and 1-4 family residential mortgages and home equity loans. In addition, it offers trust services, including the administration of estates, conservatorships, personal trusts, and agency accounts. Further, the company provides internet and mobile banking services; treasury management services comprising cash management, client-generated automated clearing house transaction, remote deposit, and fraud protection services; and merchant credit card processing services and corporate credit cards. It has eight offices in the Des Moines area; one office in Coralville; and one office in Rochester, Minnesota. West Bancorporation, Inc. was founded in 1893 and is headquartered in West Des Moines, Iowa.
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