Contrasting First Mid-Illinois Bancshares (FMBH) and Southern First Bancshares (SFST)

First Mid-Illinois Bancshares (NASDAQ: FMBH) and Southern First Bancshares (NASDAQ:SFST) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, dividends, institutional ownership, analyst recommendations and earnings.

Institutional and Insider Ownership

21.3% of First Mid-Illinois Bancshares shares are owned by institutional investors. Comparatively, 70.5% of Southern First Bancshares shares are owned by institutional investors. 20.3% of First Mid-Illinois Bancshares shares are owned by insiders. Comparatively, 12.9% of Southern First Bancshares shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares First Mid-Illinois Bancshares and Southern First Bancshares’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Mid-Illinois Bancshares $129.89 million 3.48 $26.68 million $2.14 16.69
Southern First Bancshares $62.04 million 5.15 $13.03 million $1.99 21.83

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

Profitability

This table compares First Mid-Illinois Bancshares and Southern First Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Mid-Illinois Bancshares 20.54% 9.33% 0.99%
Southern First Bancshares 21.10% 11.10% 0.97%

Analyst Ratings

This is a summary of recent ratings and price targets for First Mid-Illinois Bancshares and Southern First Bancshares, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Mid-Illinois Bancshares 0 0 1 0 3.00
Southern First Bancshares 0 1 2 0 2.67

First Mid-Illinois Bancshares presently has a consensus target price of $37.00, suggesting a potential upside of 3.58%. Southern First Bancshares has a consensus target price of $38.67, suggesting a potential downside of 11.01%. Given First Mid-Illinois Bancshares’ stronger consensus rating and higher possible upside, equities analysts clearly believe First Mid-Illinois Bancshares is more favorable than Southern First Bancshares.

Dividends

First Mid-Illinois Bancshares pays an annual dividend of $0.68 per share and has a dividend yield of 1.9%. Southern First Bancshares does not pay a dividend. First Mid-Illinois Bancshares pays out 31.8% of its earnings in the form of a dividend.

Risk & Volatility

First Mid-Illinois Bancshares has a beta of -0.04, suggesting that its share price is 104% less volatile than the S&P 500. Comparatively, Southern First Bancshares has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500.

First Mid-Illinois Bancshares Company Profile

First Mid-Illinois Bancshares, Inc. is a financial holding company. The Company is engaged in the business of banking through its subsidiaries, First Mid-Illinois Bank & Trust, N.A. (First Mid Bank) and First Clover Leaf Bank, N.A. (First Clover Leaf Bank). The Company provides data processing services to affiliates through another subsidiary, Mid-Illinois Data Services, Inc. (MIDS). The Company offers insurance products and services to customers through its subsidiary, The Checkley Agency, Inc., doing business as First Mid Insurance Group (First Mid Insurance). The Company also owns three statutory business trusts, First Mid-Illinois Statutory Trust I (First Mid Trust I), and First Mid-Illinois Statutory Trust II (First Mid Trust II), and Clover Leaf Statutory Trust I (CLST Trust). As of December 31, 2016, the Company operated in three primary lines of business: community banking, wealth management, and insurance brokerage.

Southern First Bancshares Company Profile

Southern First Bancshares, Inc. is a bank holding company that owns the capital stock of Southern First Bank (the Bank), a South Carolina state bank, and all of the stock of Greenville First Statutory Trust I and II (the Trusts). The Bank is a commercial bank with approximately nine retail offices located in Greenville, Columbia and Charleston, South Carolina. The Bank is primarily engaged in the business of accepting demand deposits and savings deposits insured by the Federal Deposit Insurance Corporation (the FDIC) and providing commercial, consumer and mortgage loans to the public. In addition to deposit and loan services, the Company offers other bank services, such as Internet banking, cash management services, safe deposit boxes, direct deposit and automatic drafts for various accounts. The Bank offers a range of lending services, including real estate, commercial, and equity-line consumer loans to individuals and small- to medium-sized businesses, and professional firms.

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