Simmons First National (NASDAQ:SFNC) versus Prime Meridian (OTCMKTS:PMHG) Head-To-Head Comparison

Simmons First National (NASDAQ:SFNC) and Prime Meridian (OTCMKTS:PMHG) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, dividends, institutional ownership, risk, profitability and valuation.

Dividends

Simmons First National pays an annual dividend of $0.85 per share and has a dividend yield of 4.9%. Prime Meridian pays an annual dividend of $1.00 per share and has a dividend yield of 1.9%. Simmons First National pays out -29.0% of its earnings in the form of a dividend. Prime Meridian pays out 40.3% 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. Simmons First National has raised its dividend for 14 consecutive years. Simmons First National is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Simmons First National and Prime Meridian”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Simmons First National	$50.15 million	50.15	$152.69 million	($2.93)	-5.93
Prime Meridian	$50.36 million	3.61	$8.49 million	$2.48	21.67

Simmons First National has higher earnings, but lower revenue than Prime Meridian. Simmons First National is trading at a lower price-to-earnings ratio than Prime Meridian, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Simmons First National has a beta of 0.97, indicating that its share price is 3% less volatile than the S&P 500. Comparatively, Prime Meridian has a beta of 0.17, indicating that its share price is 83% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Simmons First National and Prime Meridian, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Simmons First National	1	4	2	0	2.14
Prime Meridian	0	0	0	0	0.00

Simmons First National currently has a consensus target price of $22.33, indicating a potential upside of 28.50%. Given Simmons First National’s stronger consensus rating and higher probable upside, research analysts plainly believe Simmons First National is more favorable than Prime Meridian.

Profitability

This table compares Simmons First National and Prime Meridian’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Simmons First National	-29.70%	5.84%	0.78%
Prime Meridian	15.49%	9.27%	0.87%

Institutional and Insider Ownership

27.6% of Simmons First National shares are held by institutional investors. Comparatively, 11.8% of Prime Meridian shares are held by institutional investors. 1.4% of Simmons First National shares are held by company insiders. Comparatively, 25.9% of Prime Meridian shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Simmons First National beats Prime Meridian on 10 of the 17 factors compared between the two stocks.

About Simmons First National

Simmons First National Corporation operates as the holding company for Simmons Bank that provides banking and other financial products and services to individuals and businesses. The company offers checking, savings, and time deposits; consumer, real estate, and commercial loans; agricultural finance, equipment, and small business administration lending; trust and fiduciary services; credit cards; investment management products; treasury management; insurance products; and securities and investment services. It also provides ATM services; Internet and mobile banking platforms; overdraft facilities; and safe deposit boxes. The company was founded in 1903 and is headquartered in Pine Bluff, Arkansas.

About Prime Meridian

Prime Meridian Holding Company operates as the bank holding company for Prime Meridian Bank that provides various consumer and commercial banking services to individuals and businesses. The company accepts various deposits, such as checking, money market, savings, term certificate of deposit, demand interest-bearing and noninterest-bearing, health savings, NOW, and escrow accounts, as well as retirement savings plans and time deposits. Its loan products include commercial real estate, residential real estate and home equity, small business administration, construction, equipment, and commercial loans; and consumer and other loans comprising financing of automobiles, boats, and recreational vehicles, as well as issues standby letters and business lines of credit. The company also offers debit and credit cards; mobile banking, remote and mobile deposit, Apple Pay, bank-to-bank transfer, and online banking services; and safe deposit, wire transfer, foreign exchange, direct deposits, notary, night depository, official checks, domestic collections, bank drafts, automated teller services, drive-in tellers, merchant card, and banking by mail services, as well as invests in securities. Prime Meridian Holding Company was founded in 2008 and is headquartered in Tallahassee, Florida.