United Bankshares (NASDAQ:UBSI – Get Free Report) and First Guaranty Bancshares (NASDAQ:FGBI – Get Free Report) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, dividends, valuation and profitability.
Risk & Volatility
United Bankshares has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500. Comparatively, First Guaranty Bancshares has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500.
Profitability
This table compares United Bankshares and First Guaranty Bancshares’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| United Bankshares | 23.14% | 7.65% | 1.26% |
| First Guaranty Bancshares | -4.49% | -4.73% | -0.27% |
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| United Bankshares | $1.63 billion | 3.31 | $373.00 million | $2.83 | 13.43 |
| First Guaranty Bancshares | $246.45 million | 0.52 | $12.45 million | ($1.01) | -8.38 |
United Bankshares has higher revenue and earnings than First Guaranty Bancshares. First Guaranty Bancshares is trading at a lower price-to-earnings ratio than United Bankshares, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for United Bankshares and First Guaranty Bancshares, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| United Bankshares | 0 | 4 | 0 | 0 | 2.00 |
| First Guaranty Bancshares | 0 | 1 | 0 | 0 | 2.00 |
United Bankshares currently has a consensus target price of $40.50, suggesting a potential upside of 6.55%. Given United Bankshares’ higher probable upside, equities research analysts plainly believe United Bankshares is more favorable than First Guaranty Bancshares.
Insider and Institutional Ownership
70.8% of United Bankshares shares are held by institutional investors. Comparatively, 39.5% of First Guaranty Bancshares shares are held by institutional investors. 3.7% of United Bankshares shares are held by insiders. Comparatively, 47.2% of First Guaranty Bancshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Dividends
United Bankshares pays an annual dividend of $1.48 per share and has a dividend yield of 3.9%. First Guaranty Bancshares pays an annual dividend of $0.04 per share and has a dividend yield of 0.5%. United Bankshares pays out 52.3% of its earnings in the form of a dividend. First Guaranty Bancshares pays out -4.0% 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. United Bankshares has increased its dividend for 26 consecutive years. United Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Summary
United Bankshares beats First Guaranty Bancshares on 13 of the 15 factors compared between the two stocks.
About United Bankshares
United Bankshares, Inc., through its subsidiaries, primarily provides commercial and retail banking products and services in the United States. It operates through two segments, Community Banking and Mortgage Banking. The company accepts checking, savings, and time and money market accounts; individual retirement accounts; and demand deposits, statement and special savings, and NOW accounts. Its loan products include commercial loans and leases to small to mid-size industrial and commercial companies; construction and real estate loans, such as commercial and residential mortgages, and loans secured by owner-occupied real estate; personal, student, credit card receivables, personal, commercial, and floor plan loans; and home equity loans. In addition, the company provides credit cards; safe deposit boxes, wire transfers, and other banking products and services; investment and security services; services to correspondent banks, including buying and selling federal funds; automated teller machine services; and internet and telephone banking services. Further, it offers community banking services, such as asset management, real property title insurance, financial planning, mortgage banking, and brokerage services, as well as investment management and retirement planning services. United Bankshares, Inc. was incorporated in 1982 and is headquartered in Charleston, West Virginia.
About First Guaranty Bancshares
First Guaranty Bancshares, Inc. operates as the holding company for First Guaranty Bank that provides commercial banking services in Louisiana and Texas. It offers various deposit products, including personal and business checking, savings, money market, and demand accounts, as well as time deposits to consumers, small businesses, and municipalities. The company provides loans, such as non-farm, non-residential loans secured by real estate, commercial and industrial loans, one- to four-family residential loans, multifamily loans, construction and land development loans, agricultural loans, farmland loans, and consumer and other loans to small to medium-sized businesses and professionals, and individuals. In addition, it offers a range of consumer services, including credit cards, mobile deposit capture, safe deposit boxes, official checks, online and mobile banking, automated teller machines, and online bill pay; provides additional solutions, such as merchant services, remote deposit capture, and lockbox services to business customers; and invests a portion of its assets in securities issued by the United States Government and its agencies, state and municipal obligations, corporate debt securities, mutual funds, and equity securities, as well as invests in mortgage-backed securities primarily issued or guaranteed by United States Government agencies or enterprises. First Guaranty Bancshares, Inc. was founded in 1934 and is headquartered in Hammond, Louisiana.
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