Head-To-Head Analysis: National Commerce (NCOM) versus First Community Bancshares (FCBC)

National Commerce (NASDAQ: NCOM) and First Community Bancshares (NASDAQ:FCBC) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, analyst recommendations, valuation, institutional ownership, profitability and earnings.

Analyst Recommendations

This is a breakdown of recent ratings for National Commerce and First Community Bancshares, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
National Commerce 0 3 0 0 2.00
First Community Bancshares 0 1 0 0 2.00

National Commerce presently has a consensus price target of $43.67, suggesting a potential upside of 3.72%. First Community Bancshares has a consensus price target of $27.00, suggesting a potential downside of 8.51%. Given National Commerce’s higher probable upside, research analysts clearly believe National Commerce is more favorable than First Community Bancshares.

Risk & Volatility

National Commerce has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500. Comparatively, First Community Bancshares has a beta of 0.73, indicating that its stock price is 27% less volatile than the S&P 500.

Institutional and Insider Ownership

47.9% of National Commerce shares are held by institutional investors. Comparatively, 40.4% of First Community Bancshares shares are held by institutional investors. 19.4% of National Commerce shares are held by insiders. Comparatively, 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.

Dividends

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

Profitability

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

Net Margins Return on Equity Return on Assets
National Commerce 20.45% 7.28% 1.02%
First Community Bancshares 22.32% 7.67% 1.11%

Earnings and Valuation

This table compares National Commerce and First Community Bancshares’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
National Commerce $88.52 million 7.03 $17.85 million $1.83 23.01
First Community Bancshares $121.79 million 4.12 $25.12 million $1.57 18.80

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

Summary

National Commerce beats First Community Bancshares on 8 of the 14 factors compared between the two stocks.

About National Commerce

National Commerce Corporation (NCC) is a financial holding company. The Company is engaged in the business of banking through its banking subsidiary, National Bank of Commerce (the Bank). The Company, through the Bank, provides a range of financial services to businesses, business owners and professionals. It holds interest in CBI Holding Company, LLC, which owns Corporate Billing, LLC, a transaction-based finance company that provides factoring, invoicing, collection and accounts receivable management services to transportation companies, and automotive parts and service providers across the United States and Canada. Its loan portfolio includes construction, land development and other land loans; loans secured by farmland; loans secured by one- to four-family residential properties; loans secured by multifamily residential properties; loans secured by nonfarm nonresidential properties; loans secured by real estate; commercial and industrial loans; consumer loans, and other loans.

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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