Critical Comparison: BancFirst (NASDAQ:BANF) & Fulton Financial (NASDAQ:FULT)

BancFirst (NASDAQ:BANFGet Rating) and Fulton Financial (NASDAQ:FULTGet Rating) are both mid-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, analyst recommendations, valuation and profitability.

Dividends

BancFirst pays an annual dividend of $1.44 per share and has a dividend yield of 1.7%. Fulton Financial pays an annual dividend of $0.60 per share and has a dividend yield of 3.8%. BancFirst pays out 28.6% of its earnings in the form of a dividend. Fulton Financial pays out 36.8% 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. BancFirst has increased its dividend for 29 consecutive years and Fulton Financial has increased its dividend for 2 consecutive years.

Earnings & Valuation

This table compares BancFirst and Fulton Financial’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
BancFirst $497.05 million 5.48 $167.63 million $5.03 16.53
Fulton Financial $997.16 million 2.55 $275.50 million $1.63 9.72

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

Insider and Institutional Ownership

42.3% of BancFirst shares are owned by institutional investors. Comparatively, 62.8% of Fulton Financial shares are owned by institutional investors. 38.5% of BancFirst shares are owned by insiders. Comparatively, 1.0% of Fulton Financial shares are owned by 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.

Profitability

This table compares BancFirst and Fulton Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BancFirst 33.72% 14.75% 1.59%
Fulton Financial 27.63% 11.06% 1.06%

Volatility & Risk

BancFirst has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500. Comparatively, Fulton Financial has a beta of 0.73, indicating that its stock price is 27% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for BancFirst and Fulton Financial, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BancFirst 0 1 0 0 2.00
Fulton Financial 0 1 0 0 2.00

Fulton Financial has a consensus target price of $17.59, indicating a potential upside of 10.95%. Given Fulton Financial’s higher probable upside, analysts plainly believe Fulton Financial is more favorable than BancFirst.

Summary

BancFirst beats Fulton Financial on 10 of the 15 factors compared between the two stocks.

About BancFirst (Get Rating)

BancFirst Corporation operates as the bank holding company for BancFirst that provides a range of commercial banking services to retail customers, and small to medium-sized businesses. It operates through Metropolitan Banks, Community Banks, Pegasus Bank, and Other Financial Services segments. The company offers checking accounts, negotiable order of withdrawal accounts, savings accounts, money market accounts, sweep accounts, club accounts, individual retirement accounts, and certificates of deposit, as well as overdraft protection and auto draft services. It also provides commercial, financial, and other loans for working capital, facilities acquisition or expansion, purchase of equipment, and other needs; lending services that include private banking, energy, commercial and residential real estate, and commercial and industrial loans; and loans to finance purchases of consumer goods, such as automobiles, boats, household goods, vacations, and education. In addition, the company engages in the investment management and administration of trusts for individuals, corporations, and employee benefit plans, as well as bond trustee and paying agent business for various Oklahoma municipalities and governmental entities; and provision of item processing, research, and other correspondent banking services. Further, it is involved in real estate investment and insurance agency services; and providing funds transfer, collection, safe deposit box, cash management, and other services. The company serves customers in non-metropolitan trade centers and cities in the metropolitan statistical areas of Oklahoma. It operates through 108 banking locations in Oklahoma and 3 banking locations in Dallas, Texas. The company was formerly known as United Community Corporation and changed its name to BancFirst Corporation in November 1988. BancFirst Corporation was incorporated in 1984 and is headquartered in Oklahoma City, Oklahoma.

About Fulton Financial (Get Rating)

Fulton Financial Corporation operates as a financial holding company that provides consumer and commercial banking products and services. It accepts various checking accounts and savings deposit products, certificates of deposit, and individual retirement accounts. The company also offers secured consumer loans, including home equity loans and lines of credit, automobile loans, personal lines of credit, and checking account overdraft protection; construction and jumbo residential mortgage loans; and commercial lending products comprising commercial real estate, commercial and industrial, and construction loans, as well as equipment lease financing loans. In addition, it provides letters of credit, cash management services, and traditional deposit products; and wealth management services, including investment management, trust, brokerage, insurance, and investment advisory services. Further, the company owns passive investments, as well as trust preferred securities; and sells various life insurance products. It provides its products and services through traditional financial center banking, as well as through a network of automated teller machines, telephone banking, mobile banking, and online banking. The company operated branches in Pennsylvania, Maryland, Delaware, New Jersey, and Virginia. Fulton Financial Corporation was incorporated in 1882 and is headquartered in Lancaster, Pennsylvania.

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