First Bancorp (FBP) and Sierra Bancorp (BSRR) Head to Head Analysis

First Bancorp (NASDAQ: BSRR) and Sierra Bancorp (NASDAQ:BSRR) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, profitability, dividends, analyst recommendations, valuation and institutional ownership.

Profitability

This table compares First Bancorp and Sierra Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Bancorp 11.06% 6.36% 0.95%
Sierra Bancorp 21.45% 10.98% 1.18%

Earnings and Valuation

This table compares First Bancorp and Sierra Bancorp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Bancorp $650.81 million 2.85 $66.95 million $0.50 17.08
Sierra Bancorp $102.70 million 4.55 $19.53 million $1.55 19.75

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

Analyst Recommendations

This is a summary of recent ratings and price targets for First Bancorp and Sierra Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Bancorp 0 1 4 0 2.80
Sierra Bancorp 0 2 1 0 2.33

First Bancorp presently has a consensus target price of $8.50, indicating a potential downside of 0.47%. Sierra Bancorp has a consensus target price of $30.33, indicating a potential downside of 0.90%. Given First Bancorp’s stronger consensus rating and higher possible upside, research analysts clearly believe First Bancorp is more favorable than Sierra Bancorp.

Volatility and Risk

First Bancorp has a beta of 1.84, suggesting that its stock price is 84% more volatile than the S&P 500. Comparatively, Sierra Bancorp has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500.

Dividends

Sierra Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 2.1%. First Bancorp does not pay a dividend. Sierra Bancorp pays out 41.3% of its earnings in the form of a dividend. Sierra Bancorp has increased its dividend for 5 consecutive years.

Insider & Institutional Ownership

88.5% of First Bancorp shares are held by institutional investors. Comparatively, 51.9% of Sierra Bancorp shares are held by institutional investors. 21.1% of First Bancorp shares are held by insiders. Comparatively, 10.2% of Sierra Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

First Bancorp beats Sierra Bancorp on 9 of the 17 factors compared between the two stocks.

About First Bancorp

First BanCorp. operates as a bank holding company for FirstBank Puerto Rico that provides a range of financial products and services to retail, commercial, and institutional clients. It operates through six segments: Commercial and Corporate Banking, Consumer (Retail) Banking, Mortgage Banking, Treasury and Investments, United States Operations, and Virgin Islands Operations. The Commercial and Corporate Banking segment offers commercial real estate and construction loans, floor plan financing, and cash and business management services, as well as investment banking services. The Consumer (Retail) Banking segment provides auto, boat, and personal loans; credit cards; lines of credit; and deposit products comprising interest bearing and non-interest bearing checking and savings accounts, individual retirement accounts, and retail certificates of deposit (CDs), as well as engages in the finance leasing and insurance activities. The Mortgage Banking segment is involved in the origination, sale, and servicing of various residential mortgage loan products and related hedging activities; and acquisition and sale of mortgages in the secondary markets. The Treasury and Investments segment engages in the treasury and investment management activities, such as funding and liquidity management. The United States Operations segment offers checking, savings, and money market accounts; and residential mortgages, home equity loans, lines of credit, and automobile loans, as well as retail CDs, Internet banking services, cash management, remote data capture, automated clearing house transactions, and term loans. The Virgin Islands Operations segment is involved in the consumer, commercial lending, and deposit-taking activities. As of December 31, 2017, the company operated 45 branches in Puerto Rico, 11 branches in the U.S. Virgin Islands and British Virgin Islands, and 11 branches in the state of Florida. The company was founded in 1948 and is headquartered in Santurce, Puerto Rico.

About Sierra Bancorp

Sierra Bancorp operates as the bank holding company for Bank of the Sierra that provides retail and commercial banking services to individuals and businesses in California. The company accepts various deposit products, such as checking accounts, savings accounts, money market demand accounts, time deposits, retirement accounts, and sweep accounts. Its loan products include real estate loans secured by commercial, professional office, and agricultural properties; construction loans for residential and commercial development; permanent mortgage loans, land acquisition and development loans, and multifamily credit facilities; secondary market services for residential mortgage loans; agricultural production loans; commercial and industrial loans and leases, including SBA loans and direct finance leases; mortgage warehouse loans; and consumer loans. The company also offers automated teller machines; electronic point-of-sale payment alternatives; online and automated telephone banking services; and remote deposit capture and automated payroll services for business customers. As of December 31, 2017, it operated 39 full service branches, an online branch, a real estate industries center, an agricultural credit center, and an SBA lending unit. Sierra Bancorp was founded in 1977 and is headquartered in Porterville, California.

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