Critical Review: Eagle Bancorp (NASDAQ:EGBN) vs. First Bancorp (NASDAQ:FBNC)

First Bancorp (NASDAQ:FBNCGet Rating) and Eagle Bancorp (NASDAQ:EGBNGet Rating) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, valuation, risk, profitability, institutional ownership and earnings.

Volatility & Risk

First Bancorp has a beta of 1.17, indicating that its stock price is 17% more volatile than the S&P 500. Comparatively, Eagle Bancorp has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500.

Profitability

This table compares First Bancorp and Eagle Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Bancorp 29.04% 10.92% 1.21%
Eagle Bancorp 45.21% 13.59% 1.57%

Earnings and Valuation

This table compares First Bancorp and Eagle Bancorp’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Bancorp $329.53 million 3.90 $95.64 million $3.25 11.09
Eagle Bancorp $404.88 million 3.85 $176.69 million $5.58 8.74

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

Analyst Ratings

This is a summary of current ratings for First Bancorp and Eagle Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Bancorp 0 1 1 0 2.50
Eagle Bancorp 0 1 0 0 2.00

First Bancorp presently has a consensus price target of $50.50, suggesting a potential upside of 39.85%. Given First Bancorp’s stronger consensus rating and higher possible upside, research analysts clearly believe First Bancorp is more favorable than Eagle Bancorp.

Institutional & Insider Ownership

68.6% of First Bancorp shares are owned by institutional investors. Comparatively, 73.8% of Eagle Bancorp shares are owned by institutional investors. 1.9% of First Bancorp shares are owned by company insiders. Comparatively, 2.1% of Eagle Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Dividends

First Bancorp pays an annual dividend of $0.88 per share and has a dividend yield of 2.4%. Eagle Bancorp pays an annual dividend of $1.60 per share and has a dividend yield of 3.3%. First Bancorp pays out 27.1% of its earnings in the form of a dividend. Eagle Bancorp pays out 28.7% 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. First Bancorp has raised its dividend for 2 consecutive years and Eagle Bancorp has raised its dividend for 1 consecutive years.

Summary

Eagle Bancorp beats First Bancorp on 9 of the 17 factors compared between the two stocks.

About First Bancorp (Get Rating)

First Bancorp operates as the bank holding company for First Bank that provides banking products and services for individuals and small to medium-sized businesses primarily in North Carolina and northeastern South Carolina. It accepts deposit products, such as checking, savings, and money market accounts, as well as time deposits, including certificate of deposits and individual retirement accounts. The company also offers loans for a range of consumer and commercial purposes comprising loans for business, real estate, personal, home improvement, and automobiles, as well as residential mortgages and small business administration loans; and accounts receivable financing and factoring, inventory financing, and purchase order financing services. In addition, it provides credit and debit cards, letter of credits, and safe deposit box rental services, as well as electronic funds transfer services consisting of wire transfers; and internet and mobile banking, cash management, bank-by-phone services, and remote deposit capture services. Further, the company offers investment and insurance products, such as mutual funds, annuities, long-term care insurance, life insurance, and company retirement plans, as well as property and casualty insurance products; and financial planning services. As of December 31, 2021, it operated 121 branches comprising 114 branch offices located in North Carolina and seven branches in South Carolina. First Bancorp was founded in 1934 and is headquartered in Southern Pines, North Carolina.

About Eagle Bancorp (Get Rating)

Eagle Bancorp, Inc. operates as the bank holding company for EagleBank that provides commercial and consumer banking services primarily in the United States. The company also offers various commercial and consumer lending products comprising commercial loans for working capital, equipment purchases, real estate lines of credit, and government contract financing; asset based lending and accounts receivable financing; construction and commercial real estate loans; business equipment financing; consumer home equity lines of credit, personal lines of credit, and term loans; consumer installment loans, such as auto and personal loans; personal credit cards; and residential mortgage loans. In addition, it provides online and mobile banking services; and other services, including cash management services, business sweep accounts, lock boxes, remote deposit captures, account reconciliation services, merchant card services, safety deposit boxes, and automated clearing house origination, as well as after-hours depositories and ATM services. Further, the company offers insurance products and services through a referral program. The company serves sole proprietors, small and medium-sized businesses, partnerships, corporations, non-profit organizations and associations, and individuals, as well as investors. As of December 31, 2021, it operated seventeen banking offices comprising 6 in Suburban Maryland, 5 in the District of Columbia, and 6 in Northern Virginia. Eagle Bancorp, Inc. was incorporated in 1997 and is headquartered in Bethesda, Maryland.

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