Stellarone (NASDAQ: STEL) and First Community Bancshares (NASDAQ:FCBC) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, dividends, risk, profitability, analyst recommendations, earnings and institutional ownership.

Analyst Recommendations

This is a summary of recent recommendations for Stellarone and First Community Bancshares, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Stellarone 0 0 0 0 N/A
First Community Bancshares 0 1 0 0 2.00

First Community Bancshares has a consensus target price of $27.00, suggesting a potential downside of 8.81%. Given First Community Bancshares’ higher probable upside, analysts clearly believe First Community Bancshares is more favorable than Stellarone.

Profitability

This table compares Stellarone and First Community Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Stellarone N/A N/A N/A
First Community Bancshares 22.32% 7.67% 1.11%

Earnings and Valuation

This table compares Stellarone and First Community Bancshares’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Stellarone N/A N/A N/A N/A N/A
First Community Bancshares $121.79 million 4.13 $25.12 million $1.57 18.86

First Community Bancshares has higher revenue and earnings than Stellarone.

Dividends

First Community Bancshares pays an annual dividend of $0.72 per share and has a dividend yield of 2.4%. Stellarone does not pay a dividend. First Community Bancshares pays out 45.9% of its earnings in the form of a dividend.

Institutional and Insider Ownership

40.4% of First Community Bancshares shares are held by institutional investors. 3.3% of First Community Bancshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

First Community Bancshares beats Stellarone on 8 of the 9 factors compared between the two stocks.

About Stellarone

StellarOne Corporation is a bank holding company of StellarOne Bank (the Bank). The Bank is an independent commercial bank holding company. It offers services provided by full-service banks, including individual and commercial demand and time deposit accounts, commercial and consumer loans, residential mortgages, credit card services and deposit services. The Bank, through its commercial banking segment, offers Internet banking access for banking services, mobile banking and online bill payment for both consumers and commercial customers. Lending is focused on individuals and small to middle-market businesses in the local markets of the Bank. The Bank, through its wealth management segment, provides a variety of wealth management and personal trust services. The mortgage banking segment engages primarily in the origination and acquisition of residential mortgages for sale into the secondary market. In January 2014, Union First Market Bankshares Corp acquired StellarOne Corporation.

About First Community Bancshares

First Community Bancshares, Inc. is a financial holding company. The Company provides commercial banking products and services through its subsidiary First Community Bank (the Bank). The Bank operates as First Community Bank in Virginia, West Virginia, and North Carolina and People’s Community Bank, a Division of First Community Bank, in Tennessee. It provides insurance services through its subsidiary First Community Insurance Services, and offers wealth management and investment advice through its Trust Division and subsidiary First Community Wealth Management. Its products include demand deposit accounts, savings and money market accounts, certificates of deposit, and individual retirement arrangements; commercial, consumer, and real estate mortgage loans and lines of credit; various credit card, debit card, and automated teller machine card services; corporate and personal trust services; investment management services, and life, health, and property and casualty insurance products.

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