Simmons First National (NASDAQ: SFNC) and Southside Bancshares (NASDAQ:SBSI) are both financials companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, risk, profitability and valuation.

Profitability

This table compares Simmons First National and Southside Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Simmons First National 21.58% 8.79% 1.19%
Southside Bancshares 25.70% 10.32% 1.00%

Volatility & Risk

Simmons First National has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500. Comparatively, Southside Bancshares has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500.

Valuation & Earnings

This table compares Simmons First National and Southside Bancshares’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Simmons First National $440.39 million 5.94 $96.81 million $3.16 18.01
Southside Bancshares $208.32 million 5.77 $49.34 million $1.91 18.01

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

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Simmons First National and Southside Bancshares, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Simmons First National 0 4 1 0 2.20
Southside Bancshares 0 2 0 0 2.00

Simmons First National currently has a consensus price target of $62.00, suggesting a potential upside of 8.96%. Southside Bancshares has a consensus price target of $37.00, suggesting a potential upside of 7.71%. Given Simmons First National’s stronger consensus rating and higher possible upside, research analysts plainly believe Simmons First National is more favorable than Southside Bancshares.

Insider and Institutional Ownership

51.3% of Simmons First National shares are held by institutional investors. Comparatively, 43.2% of Southside Bancshares shares are held by institutional investors. 4.6% of Simmons First National shares are held by insiders. Comparatively, 17.2% of Southside Bancshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Simmons First National pays an annual dividend of $1.00 per share and has a dividend yield of 1.8%. Southside Bancshares pays an annual dividend of $1.12 per share and has a dividend yield of 3.3%. Simmons First National pays out 31.6% of its earnings in the form of a dividend. Southside Bancshares pays out 58.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Simmons First National has increased its dividend for 19 consecutive years.

Summary

Simmons First National beats Southside Bancshares on 12 of the 17 factors compared between the two stocks.

Simmons First National Company Profile

Simmons First National Corporation is a financial holding company. The Company, through its subsidiary bank, Simmons Bank, provides financial services to individuals and businesses throughout the market areas they serve. As of December 31, 2016, Simmons Bank conducted banking operations through 150 financial centers located in communities throughout Arkansas, Kansas, Missouri, Tennessee, Colorado, Oklahoma and Texas. Simmons Bank offers consumer, real estate and commercial loans, checking and savings deposits. Simmons Bank and its subsidiaries have also developed products and services, which include credit cards, investments, agricultural finance lending, equipment lending, insurance and small business administration lending. The securities within the portfolio are classified as either held-to-maturity, available-for-sale or trading. The Company offers deposits, including non-interest bearing transaction accounts; interest bearing transaction accounts, and time deposits.

Southside Bancshares Company Profile

Southside Bancshares, Inc. (Southside) is a bank holding company for Southside Bank (the Bank). The Company is a community-focused financial institution that offers a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations in the communities. These services include consumer and commercial loans, deposit accounts, trust services, safe deposit services and brokerage services. As of December 31, 2016, the Company operated through 60 banking centers, 17 of which are located in grocery stores. The Company offers a range of deposit accounts with a range of interest rates and terms, including savings, money market, interest and non-interest bearing checking accounts and certificates of deposit (CDs).

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