Head to Head Contrast: National Bank (NYSE:NBHC) & MetroCity Bankshares (NASDAQ:MCBS)

National Bank (NYSE:NBHC) and MetroCity Bankshares (NASDAQ:MCBS) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, dividends, analyst recommendations, institutional ownership and profitability.

Profitability

This table compares National Bank and MetroCity Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
National Bank	18.66%	8.65%	1.17%
MetroCity Bankshares	27.93%	14.82%	1.75%

Insider & Institutional Ownership

92.7% of National Bank shares are owned by institutional investors. Comparatively, 25.3% of MetroCity Bankshares shares are owned by institutional investors. 2.9% of National Bank shares are owned by company insiders. Comparatively, 27.5% of MetroCity Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares National Bank and MetroCity Bankshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
National Bank	$411.58 million	4.51	$109.57 million	$2.85	14.48
MetroCity Bankshares	$246.01 million	3.69	$68.53 million	$2.63	12.01

National Bank has higher revenue and earnings than MetroCity Bankshares. MetroCity Bankshares is trading at a lower price-to-earnings ratio than National Bank, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

National Bank has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500. Comparatively, MetroCity Bankshares has a beta of 0.68, meaning that its share price is 32% less volatile than the S&P 500.

Dividends

National Bank pays an annual dividend of $1.28 per share and has a dividend yield of 3.1%. MetroCity Bankshares pays an annual dividend of $1.00 per share and has a dividend yield of 3.2%. National Bank pays out 44.9% of its earnings in the form of a dividend. MetroCity Bankshares pays out 38.0% 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. National Bank has increased its dividend for 10 consecutive years. MetroCity Bankshares is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of current ratings and recommmendations for National Bank and MetroCity Bankshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
National Bank	0	2	5	0	2.71
MetroCity Bankshares	0	1	1	0	2.50

National Bank currently has a consensus price target of $45.40, indicating a potential upside of 9.98%. MetroCity Bankshares has a consensus price target of $33.00, indicating a potential upside of 4.50%. Given National Bank’s stronger consensus rating and higher possible upside, equities research analysts plainly believe National Bank is more favorable than MetroCity Bankshares.

Summary

National Bank beats MetroCity Bankshares on 11 of the 17 factors compared between the two stocks.

About National Bank

National Bank Holdings Corporation operates as the bank holding company for NBH Bank that provides various banking products and financial services to commercial, business, and consumer clients in the United States. It offers deposit products, including checking, savings, money market, and other deposit accounts, including fixed-rate and fixed maturity time deposits. The company also provides commercial and industrial loans and leases, such as working capital loans, equipment loans, lender finance loans, food and agriculture loans, government and non-profit loans, owner occupied commercial real estate loans, and other commercial loans and leases; non-owner occupied commercial real estate loans consisting of loans on commercial properties, such as office buildings, warehouse/distribution buildings, multi-family, hospitality, and retail buildings; small business administration loans to support small businesses and entrepreneurs; term loans, line of credits, and real estate secured loans; residential real estate loans; and consumer loans. In addition, it offers treasury management solutions comprising online and mobile banking, commercial credit card, wire transfer, automated clearing house, electronic bill payment, lock box, remote deposit capture, merchant processing, cash vault, controlled disbursements, and fraud prevention services, as well as other auxiliary services, including account reconciliation, collections, repurchase accounts, zero balance accounts, and sweep accounts. The company operates through a network of banking centers located in Colorado, the greater Kansas City region, New Mexico, Utah, Wyoming, Idaho, and Texas. It also operates ATMs. The company was formerly known as NBH Holdings Corp. and changed its name to National Bank Holdings Corporation in March 2012. The company was incorporated in 2009 and is headquartered in Greenwood Village, Colorado.

About MetroCity Bankshares

MetroCity Bankshares, Inc. operates as the bank holding company for Metro City Bank that engages in the provision of banking products and services in the United States. It offers customary banking services, such as consumer and commercial checking accounts, savings, and money market accounts, as well as certificates of deposit. The company also provides commercial and consumer loans, including single family residential loans; construction and development, and owner and non-owner occupied commercial real estate loans; letters of credit; and commercial and industrial loans, residential mortgage loans, and SBA loans. In addition, it offers online banking services, which include access to account balances, online transfers, online bill payment, and electronic delivery of customer statements; mobile banking solutions, such as remote check deposit with mobile bill pay; and automated teller machines and telephone banking services. Further, it provides debit cards for checking customers, direct deposits, and cashier's checks; treasury management services, including wire transfer, automated clearing house, and stop payments services; and cash management deposit products, such as remote deposit capture, positive pay, zero balance accounts, and sweep accounts. The company was founded in 2006 and is headquartered in Atlanta, Georgia.