Financial Review: Union Bankshares (NASDAQ:UNB) and FB Financial (NYSE:FBK)

FB Financial (NYSE:FBK) and Union Bankshares (NASDAQ:UNB) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, risk, profitability and dividends.

Insider and Institutional Ownership

65.4% of FB Financial shares are held by institutional investors. Comparatively, 14.8% of Union Bankshares shares are held by institutional investors. 1.7% of FB Financial shares are held by insiders. Comparatively, 1.1% of Union Bankshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

FB Financial pays an annual dividend of $0.68 per share and has a dividend yield of 1.2%. Union Bankshares pays an annual dividend of $1.44 per share and has a dividend yield of 4.2%. FB Financial pays out 29.7% of its earnings in the form of a dividend. Union Bankshares pays out 73.8% 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. Union Bankshares has raised its dividend for 11 consecutive years. Union Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares FB Financial and Union Bankshares”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FB Financial	$748.95 million	3.43	$120.22 million	$2.29	24.06
Union Bankshares	$67.01 million	2.29	$11.26 million	$1.95	17.41

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

Risk & Volatility

FB Financial has a beta of 1.15, meaning that its stock price is 15% more volatile than the S&P 500. Comparatively, Union Bankshares has a beta of 0.78, meaning that its stock price is 22% less volatile than the S&P 500.

Profitability

This table compares FB Financial and Union Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FB Financial	14.40%	10.38%	1.23%
Union Bankshares	11.74%	13.14%	0.60%

Analyst Recommendations

This is a summary of current recommendations and price targets for FB Financial and Union Bankshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FB Financial	1	3	1	0	2.00
Union Bankshares	0	0	0	0	0.00

FB Financial presently has a consensus target price of $50.20, suggesting a potential downside of 8.88%. Given FB Financial’s stronger consensus rating and higher possible upside, analysts clearly believe FB Financial is more favorable than Union Bankshares.

Summary

FB Financial beats Union Bankshares on 14 of the 17 factors compared between the two stocks.

About FB Financial

FB Financial Corporation operates as a bank holding company for FirstBank that provides a suite of commercial and consumer banking services to businesses, professionals, and individuals. The company operates in segments, such as Banking and Mortgage. It offers checking, demand, money market, and savings accounts; deposit and lending products and services to corporate, commercial, and consumer customers; and time deposits and certificates of deposits, as well as residential mortgage loans. The company also provides owner-occupied and non-owner-occupied real estate commercial, residential real estate 1-4 family mortgage, multi-family residential, commercial and industrial, construction, land acquisition, residential lines of credit, and land development loans; and consumer and other loans, such as car, boat, and other recreational vehicle loans, as well as manufactured homes without real estate and personal lines of credit. In addition, the company offers mortgage banking services through its bank branch network and mortgage banking offices in the southeastern United States; direct-to-consumer internet delivery channel; and trust, insurance, and investment services, as well as online and mobile banking services. The company operates full-service bank branches and limited-service branches locations throughout Tennessee, Nashville, Chattanooga, Knoxville, Memphis, Jackson, Birmingham, Florence, Huntsville, Alabama, Bowling Green, and Kentucky; and mortgage offices throughout the southeastern United States. The company was formerly known as First South Bancorp, Inc. and changed its name to FB Financial Corporation in 2016. FB Financial Corporation was founded in 1906 and is headquartered in Nashville, Tennessee.

About Union Bankshares

Union Bankshares, Inc. operates as the bank holding company for Union Bank that provides retail, commercial, and municipal banking products and services in northern Vermont and New Hampshire. It offers retail depository services, such as personal checking, savings, money market, IRA/SEP/KEOGH, and health savings accounts, as well as certificates of deposit. The company also provides commercial real estate loans; commercial loans for plant and equipment, working capital, real estate renovation, and other business purposes to business owners and investors; small business administration guaranteed loans; residential construction and mortgage loans; municipal financing, including loans and excess deposits secured by FHLBB letters of credit; and home improvement loans and overdraft checking privileges against preauthorized lines of credit. In addition, it offers online cash management services, including account reconciliation, credit card depository, automated clearing house origination, wire transfers, positive pay and night depository services; merchant credit card services for the deposit and immediate credit of sales drafts; remote deposit capture services; and online mortgage application and consumer deposit account opening services. Further, the company provides business checking accounts; standby letters of credit, bank checks or money orders, and safe deposit boxes; ATM cards and services; debit cards; telephone, internet, and mobile banking services, including bill pay; and wealth management, fiduciary, and trust services. It offers retail banking services to individuals; and commercial banking services to small and medium sized business corporations, limited liability companies, partnerships, and sole proprietorships, as well as nonprofit organizations, local municipalities, and school districts. Union Bankshares, Inc. was founded in 1891 and is headquartered in Morrisville, Vermont.