Contrasting United Bankshares (NASDAQ:UBSI) and Truxton (OTCMKTS:TRUX)

Truxton (OTCMKTS:TRUX) and United Bankshares (NASDAQ:UBSI) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, analyst recommendations, profitability, dividends, institutional ownership, earnings and valuation.

Risk & Volatility

Truxton has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500. Comparatively, United Bankshares has a beta of 0.78, indicating that its stock price is 22% less volatile than the S&P 500.

Dividends

Truxton pays an annual dividend of $2.00 per share and has a dividend yield of 2.3%. United Bankshares pays an annual dividend of $1.52 per share and has a dividend yield of 3.4%. Truxton pays out 26.9% of its earnings in the form of a dividend. United Bankshares pays out 46.5% 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. United Bankshares has increased its dividend for 26 consecutive years. United Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Truxton and United Bankshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Truxton	$92.29 million	2.67	$21.48 million	$7.44	11.49
United Bankshares	$1.82 billion	3.41	$464.60 million	$3.27	13.54

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

Analyst Ratings

This is a summary of recent recommendations and price targets for Truxton and United Bankshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Truxton	0	0	0	0	0.00
United Bankshares	0	3	1	1	2.60

United Bankshares has a consensus price target of $44.67, indicating a potential upside of 0.90%. Given United Bankshares’ stronger consensus rating and higher possible upside, analysts clearly believe United Bankshares is more favorable than Truxton.

Insider and Institutional Ownership

0.3% of Truxton shares are held by institutional investors. Comparatively, 70.8% of United Bankshares shares are held by institutional investors. 3.5% of United Bankshares shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Truxton and United Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Truxton	23.28%	N/A	N/A
United Bankshares	25.51%	8.60%	1.40%

Summary

United Bankshares beats Truxton on 16 of the 18 factors compared between the two stocks.

About Truxton

Truxton Corporation, through its subsidiaries, provides various banking, investment management, and trust administration services to individuals, businesses, and charitable institutions in the United States. The company offers deposit products, including demand, money market accounts, and certificates of deposit. It also provides lending products, such as residential and commercial real estate mortgages, commercial loans, construction and land development loans, commercial and industrial loans, operating lines of credit, and loans to individual. In addition, the company offers strategic and capital advisory services, business banking, and treasury management services; and insurance products. The company was formerly known as NBT Holdings Inc. and changed its name to Truxton Corporation in May 2013. Truxton Corporation was founded in 2004 and is based in Nashville, Tennessee.

About United Bankshares

United Bankshares, Inc., through its subsidiaries, primarily provides commercial and retail banking products and services in the United States. It operates through two segments, Community Banking and Mortgage Banking. The company accepts checking, savings, and time and money market accounts; individual retirement accounts; and demand deposits, statement and special savings, and NOW accounts. Its loan products include commercial loans and leases to small to mid-size industrial and commercial companies; construction and real estate loans, such as commercial and residential mortgages, and loans secured by owner-occupied real estate; personal, student, credit card receivables, personal, commercial, and floor plan loans; and home equity loans. In addition, the company provides credit cards; safe deposit boxes, wire transfers, and other banking products and services; investment and security services; services to correspondent banks, including buying and selling federal funds; automated teller machine services; and internet and telephone banking services. Further, it offers community banking services, such as asset management, real property title insurance, financial planning, mortgage banking, and brokerage services, as well as investment management and retirement planning services. United Bankshares, Inc. was incorporated in 1982 and is headquartered in Charleston, West Virginia.