Community Trust Bancorp (NASDAQ:CTBI – Get Rating) and ServisFirst Bancshares (NASDAQ:SFBS – Get Rating) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, dividends, risk, profitability, institutional ownership and earnings.
Institutional & Insider Ownership
58.0% of Community Trust Bancorp shares are held by institutional investors. Comparatively, 62.5% of ServisFirst Bancshares shares are held by institutional investors. 4.1% of Community Trust Bancorp shares are held by company insiders. Comparatively, 8.3% of ServisFirst Bancshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
This table compares Community Trust Bancorp and ServisFirst Bancshares’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Community Trust Bancorp||35.41%||12.33%||1.55%|
Community Trust Bancorp pays an annual dividend of $1.60 per share and has a dividend yield of 4.0%. ServisFirst Bancshares pays an annual dividend of $0.92 per share and has a dividend yield of 1.2%. Community Trust Bancorp pays out 33.9% of its earnings in the form of a dividend. ServisFirst Bancshares pays out 23.4% 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 42 consecutive years. Community Trust Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation & Earnings
This table compares Community Trust Bancorp and ServisFirst Bancshares’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Community Trust Bancorp||$238.63 million||3.03||$87.94 million||$4.72||8.56|
|ServisFirst Bancshares||$449.76 million||9.47||$207.73 million||$3.93||19.96|
ServisFirst Bancshares has higher revenue and earnings than Community Trust Bancorp. Community Trust Bancorp is trading at a lower price-to-earnings ratio than ServisFirst Bancshares, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Community Trust Bancorp has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500. Comparatively, ServisFirst Bancshares has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500.
This is a summary of current ratings and recommmendations for Community Trust Bancorp and ServisFirst Bancshares, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Community Trust Bancorp||0||0||0||0||N/A|
ServisFirst Bancshares has a consensus price target of $86.50, suggesting a potential upside of 10.29%. Given ServisFirst Bancshares’ higher possible upside, analysts plainly believe ServisFirst Bancshares is more favorable than Community Trust Bancorp.
ServisFirst Bancshares beats Community Trust Bancorp on 11 of the 15 factors compared between the two stocks.
Community Trust Bancorp Company Profile (Get Rating)
Community Trust Bancorp, Inc. operates as the bank holding company for Community Trust Bank, Inc. that provides commercial and personal banking services to small and mid-sized communities. 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 products include 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, and trust and wealth management services; debit cards; annuity and life insurance products; and repurchase agreements, as well as mobile, internet banking, and e-statement services. The company operates 79 banking locations in eastern, northeastern, central, south central Kentucky, southern West Virginia, and northeastern Tennessee; 4 trust offices across Kentucky; and 1 trust office in northeastern Tennessee. Community Trust Bancorp, Inc. was founded in 1903 and is headquartered in Pikeville, Kentucky.
ServisFirst Bancshares Company Profile (Get Rating)
ServisFirst Bancshares, Inc. operates as the bank holding company for ServisFirst Bank that provides various banking services to individual and corporate customers. It accepts demand, time, savings, and other deposits; checking, money market, and IRA accounts; and certificates of deposit. The company's loan products include commercial lending products, such as seasonal, bridge, and term loans for working capital, expansion of the business, acquisition of property, and plant and equipment, as well as commercial lines of credit; commercial real estate loans, construction and development loans, and residential real estate loans; and consumer loans, such as home equity loans, vehicle financing, loans secured by deposits, and secured and unsecured personal loans. It also offers other banking products and services comprising telephone and mobile banking, direct deposit, Internet banking, traveler's checks, safe deposit boxes, attorney trust accounts, automatic account transfers, automated teller machines, and debit card systems, as well as Visa credit cards; treasury and cash management services; wire transfer, night depository, banking-by-mail, and remote capture services; and correspondent banking services to other financial institutions. In addition, the company holds and manages participations in residential mortgages and commercial real estate loans originated by ServisFirst Bank in Alabama, Florida, Georgia, and Tennessee. It operates 23 full-service banking offices located in Alabama, Florida, Georgia, South Carolina, and Tennessee, as well as 2 loan production offices in Florida. The company was founded in 2005 and is headquartered in Birmingham, Alabama.
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