Critical Analysis: SmartFinancial (SMBK) vs. Its Rivals

SmartFinancial (NASDAQ: SMBK) is one of 137 publicly-traded companies in the “National commercial banks” industry, but how does it compare to its competitors? We will compare SmartFinancial to related companies based on the strength of its analyst recommendations, dividends, profitability, institutional ownership, valuation, risk and earnings.

Risk & Volatility

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SmartFinancial has a beta of 0.16, indicating that its share price is 84% less volatile than the S&P 500. Comparatively, SmartFinancial’s competitors have a beta of 0.73, indicating that their average share price is 27% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for SmartFinancial and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SmartFinancial 0 0 0 0 N/A
SmartFinancial Competitors 976 4656 4394 218 2.38

As a group, “National commercial banks” companies have a potential upside of 7.90%. Given SmartFinancial’s competitors higher possible upside, analysts plainly believe SmartFinancial has less favorable growth aspects than its competitors.

Valuation and Earnings

This table compares SmartFinancial and its competitors top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
SmartFinancial $57.00 million $5.01 million 20.86
SmartFinancial Competitors $7.03 billion $1.20 billion 16.37

SmartFinancial’s competitors have higher revenue and earnings than SmartFinancial. SmartFinancial is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares SmartFinancial and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SmartFinancial 8.80% 5.69% 0.69%
SmartFinancial Competitors -8.04% -9.42% 0.25%

Insider and Institutional Ownership

31.1% of SmartFinancial shares are owned by institutional investors. Comparatively, 51.0% of shares of all “National commercial banks” companies are owned by institutional investors. 13.9% of SmartFinancial shares are owned by insiders. Comparatively, 9.9% of shares of all “National commercial banks” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

SmartFinancial Company Profile

SmartFinancial, Inc., formerly Cornerstone Bancshares, Inc., is a bank holding company. The Company operates through its SmartBank subsidiary (The Bank). The principal business of the Bank consists of attracting deposits from the public and investing those funds, together with funds generated from operations and from principal and interest payments on loans. It offers commercial real estate-mortgage, consumer real estate-mortgage, construction and land development, commercial and industrial, and consumer and other loans. The Bank’s investment portfolio consists of Federal agency bonds, mortgage-backed securities, and state and municipal securities. The Bank provides a range of deposit services to businesses and individuals, including non-interest bearing checking accounts, interest bearing checking accounts, savings accounts, money market accounts, individual retirement accounts (IRAs) and certificates of deposit (CDs). SmartBank operates in approximately 22 branches.

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