Head to Head Analysis: Texas Capital Bancshares (NASDAQ:TCBI) vs. First Horizon (NYSE:FHN)

Texas Capital Bancshares (NASDAQ:TCBI) and First Horizon (NYSE:FHN) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, institutional ownership and risk.

Volatility & Risk

Texas Capital Bancshares has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500. Comparatively, First Horizon has a beta of 0.61, suggesting that its share price is 39% less volatile than the S&P 500.

Insider and Institutional Ownership

96.9% of Texas Capital Bancshares shares are owned by institutional investors. Comparatively, 80.3% of First Horizon shares are owned by institutional investors. 1.7% of Texas Capital Bancshares shares are owned by insiders. Comparatively, 1.0% of First Horizon shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Texas Capital Bancshares and First Horizon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Texas Capital Bancshares	15.14%	9.51%	0.96%
First Horizon	18.08%	10.93%	1.16%

Earnings and Valuation

This table compares Texas Capital Bancshares and First Horizon”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Texas Capital Bancshares	$1.94 billion	2.16	$77.51 million	$6.11	15.01
First Horizon	$5.03 billion	2.36	$775.00 million	$1.65	14.62

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Texas Capital Bancshares and First Horizon, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Texas Capital Bancshares	3	7	4	0	2.07
First Horizon	0	10	8	1	2.53

Texas Capital Bancshares currently has a consensus price target of $89.40, indicating a potential downside of 2.51%. First Horizon has a consensus price target of $25.41, indicating a potential upside of 5.38%. Given First Horizon’s stronger consensus rating and higher probable upside, analysts plainly believe First Horizon is more favorable than Texas Capital Bancshares.

Summary

First Horizon beats Texas Capital Bancshares on 10 of the 15 factors compared between the two stocks.

About Texas Capital Bancshares

Texas Capital Bancshares, Inc. operates as the bank holding company for Texas Capital Bank, is a full-service financial services firm that delivers customized solutions to businesses, entrepreneurs, and individual customers. The company offers commercial banking; consumer banking; investment banking solutions, including capital markets, mergers and acquisitions, and syndicated finance, as well as financial sponsor coverage, capital solutions, and institutional services; and wealth management services, such as investment management, financial planning, lockbox and insurance, securities-based lending, estate planning, and business succession, as well as philanthropic, trustee and executor, custom credit, and depository services. It also provides deposit accounts, analyzed accounts, commercial card, SBA and business loans, packaged solutions, and merchant services; liquidity and investments, working capital, international trade and payment, and treasury and credit products; and commercial real estate, homebuilder and community, and mortgage finance. In addition, the company offers payables and receivables management; online and mobile banking; term loans and lines of credit, equipment finance and lease, acquisition finance, and asset-based lending; private wealth advisory solutions; and checking and savings accounts, debit and credit cards, and certificates of deposit, as well as ETF and funds management services. Further, it provides financial institution money market accounts and loan syndication products; commercial loans for financing for working capital, organic growth, and acquisitions; real estate term and construction loans; mortgage warehouse lending services; treasury management, trust, and advisory and escrow services; and letters of credit. The company operates in Austin, Dallas, Fort Worth, Houston, and San Antonio metropolitan areas of Texas. Texas Capital Bancshares, Inc. was incorporated in 1996 and is headquartered in Dallas, Texas.

About First Horizon

First Horizon Corporation operates as the bank holding company for First Horizon Bank that provides various financial services. The company operates through Regional Banking and Specialty Banking segments. It offers general banking services for consumers, businesses, financial institutions, and governments. The company also accepts deposits; provides underwriting services for bank-eligible securities and other fixed-income securities by financial subsidiaries; sells loans and derivatives; financial planning; and offers investment and financial advisory services. In addition, it offers mortgage banking; loan syndications; brokerage services; commercial and business banking for business enterprises, consumer banking, and private client and wealth management services; capital markets, professional commercial real estate, mortgage warehouse and asset-based lending, franchise and equipment finance, tax credit finance, energy and healthcare finance, asset management, and corporate and correspondent banking services. Further, the company provides transaction processing services including check clearing services and remittance processing, credit cards, investment, and sale of mutual fund and retail insurances, as well as trust, fiduciary, and agency services. First Horizon Corporation was founded in 1864 and is headquartered in Memphis, Tennessee.