Paragon Commercial (PBNC) vs. Renasant (RNST) Critical Contrast

Paragon Commercial (NASDAQ: PBNC) and Renasant (NASDAQ:RNST) are both financials companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Analyst Recommendations

This is a summary of recent ratings and price targets for Paragon Commercial and Renasant, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Paragon Commercial 0 2 0 0 2.00
Renasant 0 4 1 0 2.20

Renasant has a consensus target price of $45.25, suggesting a potential upside of 5.60%. Given Renasant’s stronger consensus rating and higher probable upside, analysts clearly believe Renasant is more favorable than Paragon Commercial.

Insider & Institutional Ownership

32.3% of Paragon Commercial shares are held by institutional investors. Comparatively, 65.2% of Renasant shares are held by institutional investors. 23.3% of Paragon Commercial shares are held by insiders. Comparatively, 3.9% of Renasant shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Paragon Commercial and Renasant’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Paragon Commercial $55.46 million 5.30 $13.39 million $2.67 20.16
Renasant $506.89 million 4.17 $92.19 million $2.27 18.88

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

Dividends

Renasant pays an annual dividend of $0.76 per share and has a dividend yield of 1.8%. Paragon Commercial does not pay a dividend. Renasant pays out 33.5% of its earnings in the form of a dividend.

Profitability

This table compares Paragon Commercial and Renasant’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Paragon Commercial 29.56% 11.37% 0.99%
Renasant 18.19% 8.45% 1.22%

Summary

Renasant beats Paragon Commercial on 8 of the 15 factors compared between the two stocks.

Paragon Commercial Company Profile

Paragon Commercial Corporation is a bank holding company for Paragon Bank (the Bank). The Bank is engaged in general commercial banking in Wake and Mecklenburg Counties, North California. The Bank offers private banking and commercial banking services. Its private banking services include deposit services, such as debit cards and safe deposit boxes. Its commercial banking services include deposit services, such as business checking, nonprofit checking and business money market; courier service; remote deposit capture; merchant services; zero balance accounts; cash vault/deposit service, and account management services, such as automated sweeps and reconciliation. It also offers mobile and online banking services. Its borrowing services include commercial loans and lines, corporate credit cards and home purchase/refinance. It also offers wealth management and investment services.

Renasant Company Profile

Renasant Corporation is a bank holding company that owns and operates Renasant Bank (the Bank) and Renasant Insurance, Inc. (Renasant Insurance). The Company’s segments include Community Banks, which delivers a range of banking and financial services to individuals and small to medium-sized businesses, including checking and savings accounts, business and personal loans, equipment leasing, as well as safe deposit and night depository facilities; Insurance, which includes a full service insurance agency offering all lines of commercial and personal insurance through major carriers; Wealth Management, which offers a range of fiduciary services that includes the administration and management of trust accounts, including personal and corporate benefit accounts, and custodial accounts, and Other. The Bank has its operations in Mississippi, Tennessee, Alabama, Florida and Georgia. Renasant Insurance has its operations in Mississippi. Renasant Insurance is a subsidiary of the Bank.

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