Comparing TriCo Bancshares (NASDAQ:TCBK) and FS Bancorp (NASDAQ:FSBW)

TriCo Bancshares (NASDAQ:TCBK) and FS Bancorp (NASDAQ:FSBW) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Profitability

This table compares TriCo Bancshares and FS Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TriCo Bancshares	21.11%	8.99%	1.14%
FS Bancorp	15.88%	11.32%	1.09%

Volatility and Risk

TriCo Bancshares has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500. Comparatively, FS Bancorp has a beta of 0.74, indicating that its share price is 26% less volatile than the S&P 500.

Insider & Institutional Ownership

59.1% of TriCo Bancshares shares are owned by institutional investors. Comparatively, 63.9% of FS Bancorp shares are owned by institutional investors. 4.8% of TriCo Bancshares shares are owned by company insiders. Comparatively, 12.7% of FS Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares TriCo Bancshares and FS Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TriCo Bancshares	$531.04 million	2.67	$114.87 million	$3.40	12.83
FS Bancorp	$206.39 million	1.46	$35.02 million	$4.21	9.43

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

Analyst Ratings

This is a breakdown of recent recommendations and price targets for TriCo Bancshares and FS Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TriCo Bancshares	0	4	3	0	2.43
FS Bancorp	0	1	1	0	2.50

TriCo Bancshares presently has a consensus target price of $47.60, suggesting a potential upside of 9.15%. FS Bancorp has a consensus target price of $44.00, suggesting a potential upside of 10.86%. Given FS Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe FS Bancorp is more favorable than TriCo Bancshares.

Dividends

TriCo Bancshares pays an annual dividend of $1.44 per share and has a dividend yield of 3.3%. FS Bancorp pays an annual dividend of $1.12 per share and has a dividend yield of 2.8%. TriCo Bancshares pays out 42.4% of its earnings in the form of a dividend. FS Bancorp pays out 26.6% 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. TriCo Bancshares has increased its dividend for 12 consecutive years and FS Bancorp has increased its dividend for 12 consecutive years.

About TriCo Bancshares

TriCo Bancshares operates as a bank holding company for Tri Counties Bank that provides commercial banking services to individual and corporate customers. The company accepts demand, savings, and time deposits. It also provides small business loans; real estate mortgage loans, such as residential and commercial loans; consumer loans; mortgage, auto, other vehicle, and personal loans; commercial loans, including agricultural loans; and real estate construction loans. In addition, the company offers treasury management services; credit and debit cards; and other customary banking services, including safe deposit boxes; and independent financial and broker-dealer services. Further, it provides checking, saving, and money market accounts, as well as individual retirement accounts; equipment financing; certificate of deposit account registry service; certificated of deposit; and IntraFi cash service. TriCo Bancshares was founded in 1975 and is headquartered in Chico, California.

About FS Bancorp

FS Bancorp, Inc. operates as a bank holding company for 1st Security Bank of Washington that provides banking and financial services to local families, local and regional businesses, and industry niches. The company operates in two segments, Commercial and Consumer Banking; and Home Lending. It offers various deposit instruments, including checking accounts, money market deposit accounts, savings accounts, and certificates of deposit. The company provides one-to-four-family residential first mortgages, second mortgage/home equity loan products, non-mortgage commercial business loans, commercial real estate loans, and construction and development loans, as well as consumer loans, which primarily include personal lines of credit, credit cards, automobile, direct home improvement, loans on deposit, and recreational loans. It operates full bank service branches and home loan production offices in suburban communities in the greater Puget Sound area, including Snohomish, King, Pierce, Jefferson, Kitsap, Clallam, Grays Harbor, and Thurston counties; and a loan production office in the market area of the Tri-Cities. FS Bancorp, Inc. was founded in 1936 and is headquartered in Mountlake Terrace, Washington.