TriCo Bancshares (NASDAQ: TCBK) and National Commerce Corporation (NASDAQ:NCOM) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, profitabiliy, dividends, valuation, analyst recommendations, risk and earnings.
Institutional and Insider Ownership
69.4% of TriCo Bancshares shares are held by institutional investors. Comparatively, 36.9% of National Commerce Corporation shares are held by institutional investors. 9.1% of TriCo Bancshares shares are held by insiders. Comparatively, 19.4% of National Commerce Corporation shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Dividends
TriCo Bancshares pays an annual dividend of $0.68 per share and has a dividend yield of 1.9%. National Commerce Corporation does not pay a dividend. TriCo Bancshares pays out 34.0% of its earnings in the form of a dividend.
Earnings and Valuation
This table compares TriCo Bancshares and National Commerce Corporation’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| TriCo Bancshares | $222.45 million | 3.72 | $45.75 million | $2.00 | 18.10 |
| National Commerce Corporation | $87.35 million | 6.55 | $24.06 million | $1.71 | 23.77 |
TriCo Bancshares has higher revenue and earnings than National Commerce Corporation. TriCo Bancshares is trading at a lower price-to-earnings ratio than National Commerce Corporation, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of current recommendations and price targets for TriCo Bancshares and National Commerce Corporation, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| TriCo Bancshares | 0 | 2 | 1 | 0 | 2.33 |
| National Commerce Corporation | 0 | 5 | 0 | 0 | 2.00 |
TriCo Bancshares presently has a consensus target price of $33.00, indicating a potential downside of 8.84%. National Commerce Corporation has a consensus target price of $41.50, indicating a potential upside of 2.09%. Given National Commerce Corporation’s higher possible upside, analysts plainly believe National Commerce Corporation is more favorable than TriCo Bancshares.
Profitability
This table compares TriCo Bancshares and National Commerce Corporation’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| TriCo Bancshares | 20.92% | 9.63% | 1.03% |
| National Commerce Corporation | 20.52% | 7.90% | 1.01% |
Volatility & Risk
TriCo Bancshares has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500. Comparatively, National Commerce Corporation has a beta of 1.08, indicating that its stock price is 8% more volatile than the S&P 500.
Summary
TriCo Bancshares beats National Commerce Corporation on 10 of the 16 factors compared between the two stocks.
About TriCo Bancshares
TriCo Bancshares is a bank holding company. The Company’s principal subsidiary is Tri Counties Bank, a California-chartered commercial bank (the Bank). The Bank offers banking services to retail customers and small to medium-sized businesses through 68 branch offices in Northern and Central California. As of December 31, 2016, the Bank was engaged in the general commercial banking business in 26 counties in Northern and Central California. The Bank operated from 58 traditional branches and 10 in-store branches, as of December 31, 2016. The Bank conducts a commercial banking business, including accepting demand, savings and time deposits and making commercial, real estate, and consumer loans. It also offers installment note collection, issues cashier’s checks, sells travelers checks and provides safe deposit boxes and other customary banking services.
About National Commerce Corporation
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.
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