Critical Survey: United Bancorp (NASDAQ:UBCP) & First Busey (NASDAQ:BUSE)

First Busey (NASDAQ:BUSE) and United Bancorp (NASDAQ:UBCP) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, earnings, dividends and risk.

Institutional & Insider Ownership

56.5% of First Busey shares are held by institutional investors. Comparatively, 15.4% of United Bancorp shares are held by institutional investors. 3.9% of First Busey shares are held by company insiders. Comparatively, 13.9% of United Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and price targets for First Busey and United Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Busey	0	3	4	0	2.57
United Bancorp	0	1	0	0	2.00

First Busey currently has a consensus price target of $27.17, indicating a potential upside of 3.69%. Given First Busey’s stronger consensus rating and higher probable upside, research analysts plainly believe First Busey is more favorable than United Bancorp.

Profitability

This table compares First Busey and United Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Busey	12.96%	9.46%	1.21%
United Bancorp	16.32%	12.05%	0.91%

Valuation & Earnings

This table compares First Busey and United Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Busey	$1.04 billion	2.15	$135.26 million	$1.29	20.31
United Bancorp	$47.51 million	1.93	$7.75 million	$1.34	11.87

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

Dividends

First Busey pays an annual dividend of $1.04 per share and has a dividend yield of 4.0%. United Bancorp pays an annual dividend of $0.77 per share and has a dividend yield of 4.8%. First Busey pays out 80.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. United Bancorp pays out 57.5% of its earnings in the form of a dividend. First Busey has increased its dividend for 10 consecutive years and United Bancorp has increased its dividend for 13 consecutive years. United Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

First Busey has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500. Comparatively, United Bancorp has a beta of 0.34, meaning that its share price is 66% less volatile than the S&P 500.

Summary

First Busey beats United Bancorp on 10 of the 17 factors compared between the two stocks.

About First Busey

First Busey Corporation operates as the bank holding company for Busey Bank that engages in the provision of retail and commercial banking products and services to individual, corporate, institutional, and governmental customers in the United States. It operates through three segments: Banking, Wealth Management, and FirsTech. The Banking segment provides banking services to individual customers, such as demand and savings deposits, money transfers, safe deposit services, individual retirement accounts and other fiduciary services, automated teller machines, and technology-based networks, as well as loan products, including residential real estate, home equity lines of credit, and consumer loans. This segment also offers banking services to corporate customers, including commercial, commercial real estate, real estate construction, and agricultural loans, as well as cash management services. The Wealth Management segment offers a range of investment and asset management, investment, brokerage, investment strategy consulting, fiduciary, philanthropic advisory, tax preparation, business succession planning, and employee retirement plan services to individuals, businesses, and foundations; and professional farm management services to the agricultural industry. The FirsTech segment provides payment technology solutions comprising online, mobile, and voice-recognition bill payments; money management and credit card networks; direct debit services; lockbox remittance processing for payments made by mail; and walk-in payments, as well as tools to help clients with billing, reconciliation, bill reminders, and treasury services. The company was founded in 1868 and is headquartered in Champaign, Illinois.

About United Bancorp

United Bancorp, Inc. operates as the bank holding company for Unified Bank that provides commercial and retail banking services in Ohio. The company provides range of banking and financial services, which includes accepting demand, savings, and time deposits. It also offers commercial, real estate and consumer loans. United Bancorp, Inc. was founded in 1902 and is headquartered in Martins Ferry, Ohio.