Comparing Southside Bancshares (NYSE:SBSI) & Texas Capital Bancshares (NASDAQ:TCBI)

Southside Bancshares (NYSE:SBSI) and Texas Capital Bancshares (NASDAQ:TCBI) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Southside Bancshares	15.58%	10.94%	1.07%
Texas Capital Bancshares	15.14%	9.51%	0.96%

Volatility and Risk

Southside Bancshares has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500. Comparatively, Texas Capital Bancshares has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500.

Institutional and Insider Ownership

55.7% of Southside Bancshares shares are held by institutional investors. Comparatively, 96.9% of Texas Capital Bancshares shares are held by institutional investors. 6.0% of Southside Bancshares shares are held by insiders. Comparatively, 1.7% of Texas Capital Bancshares shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Southside Bancshares and Texas Capital Bancshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Southside Bancshares	$456.07 million	2.13	$88.49 million	$2.30	14.03
Texas Capital Bancshares	$1.94 billion	2.31	$77.51 million	$6.11	16.04

Southside Bancshares has higher earnings, but lower revenue than Texas Capital Bancshares. Southside Bancshares 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 summary of current ratings and target prices for Southside Bancshares and Texas Capital Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southside Bancshares	0	1	0	0	2.00
Texas Capital Bancshares	3	8	4	0	2.07

Texas Capital Bancshares has a consensus price target of $93.09, indicating a potential downside of 5.02%. Given Texas Capital Bancshares’ stronger consensus rating and higher probable upside, analysts clearly believe Texas Capital Bancshares is more favorable than Southside Bancshares.

Summary

Texas Capital Bancshares beats Southside Bancshares on 9 of the 14 factors compared between the two stocks.

About Southside Bancshares

Southside Bancshares, Inc. operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations. Its deposit products include savings, money market, and interest and noninterest bearing checking accounts, as well as certificates of deposit. The company’s loan portfolio comprises consumer loans that include 1-4 family residential loans, home equity loans, home improvement loans, automobile loans, and other consumer related loans; commercial loans, such as short-term working capital loans for inventory and accounts receivable, short and medium-term loans for equipment or other business capital expansion, commercial real estate loans, and municipal loans; and construction loans for 1-4 family residential and commercial real estate. It also offers wealth management and trust services consisting of investment management, administration, revocable and testamentary trusts, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. As of December 31, 2021, the company operated through 56 banking facilities and 73 ATMs/ITMs. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.

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.