Critical Comparison: F.N.B. (NYSE:FNB) versus National Bankshares (NASDAQ:NKSH)

National Bankshares (NASDAQ:NKSH) and F.N.B. (NYSE:FNB) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, earnings, profitability, risk and dividends.

Analyst Recommendations

This is a summary of recent ratings and target prices for National Bankshares and F.N.B., as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
National Bankshares	0	1	1	0	2.50
F.N.B.	0	0	8	0	3.00

National Bankshares presently has a consensus price target of $38.00, indicating a potential upside of 30.99%. F.N.B. has a consensus price target of $18.64, indicating a potential upside of 14.76%. Given National Bankshares’ higher possible upside, equities research analysts plainly believe National Bankshares is more favorable than F.N.B..

Earnings & Valuation

This table compares National Bankshares and F.N.B.”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
National Bankshares	$50.05 million	3.69	$7.62 million	$1.77	16.39
F.N.B.	$2.57 billion	2.27	$465.00 million	$1.28	12.69

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

Insider & Institutional Ownership

29.7% of National Bankshares shares are held by institutional investors. Comparatively, 79.3% of F.N.B. shares are held by institutional investors. 3.2% of National Bankshares shares are held by company insiders. Comparatively, 1.4% of F.N.B. shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Dividends

National Bankshares pays an annual dividend of $1.46 per share and has a dividend yield of 5.0%. F.N.B. pays an annual dividend of $0.48 per share and has a dividend yield of 3.0%. National Bankshares pays out 82.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. F.N.B. pays out 37.5% of its earnings in the form of a dividend.

Profitability

This table compares National Bankshares and F.N.B.’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
National Bankshares	13.58%	7.69%	0.70%
F.N.B.	17.88%	7.94%	1.04%

Risk and Volatility

National Bankshares has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500. Comparatively, F.N.B. has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500.

Summary

F.N.B. beats National Bankshares on 10 of the 16 factors compared between the two stocks.

About National Bankshares

National Bankshares, Inc. operates as the bank holding company for the National Bank of Blacksburg that provides retail and commercial banking products and services to individuals, businesses, non-profits, and local governments. The company accepts interest-bearing and non-interest-bearing demand deposit accounts, money market deposit accounts, savings accounts, certificates of deposit, health savings accounts, and individual retirement accounts. Its loan products include commercial and agricultural, commercial real estate, residential real estate, home equity, and various consumer loan products, as well as loans for the construction of commercial and residential properties. The company also provides business and consumer debit and credit cards; letters of credit, night depository services, safe deposit boxes, utility payment services, and automatic funds transfer; wealth management, trust, and estate services; non-deposit investment and insurance products; and telephone, mobile, and Internet banking services. The company was founded in 1891 and is headquartered in Blacksburg, Virginia.

About F.N.B.

F.N.B. Corporation, a bank and financial holding company, provides a range of financial products and services primarily to consumers, corporations, governments, and small- to medium-sized businesses in the United States. The company operates through three segments: Community Banking, Wealth Management, and Insurance. The Community Banking segment offers commercial and consumer banking services, including corporate and small business banking, investment real estate financing, business credit, capital market, and lease financing services. It also provides consumer banking products and services, such as deposit products, mortgage and consumer lending services, and mobile and online banking services. The Wealth Management segment provides personal and corporate fiduciary services comprising administration of decedent and trust estates; and securities brokerage and investment advisory services, mutual funds, and annuities. The Insurance segment comprises commercial and personal insurance, and reinsurance products, as well as mezzanine financing options for small- to medium-sized businesses. The company operates community banking branches in Pennsylvania, Ohio, Maryland, West Virginia, North Carolina, South Carolina, Washington, D.C., and Virginia. F.N.B. Corporation was founded in 1864 and is headquartered in Pittsburgh, Pennsylvania.