Simmons First National (NASDAQ: SFNC) and Chemung Financial (NASDAQ:CHMG) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, earnings, risk and valuation.
Volatility & Risk
Simmons First National has a beta of 1.15, meaning that its share price is 15% more volatile than the S&P 500. Comparatively, Chemung Financial has a beta of 0.17, meaning that its share price is 83% less volatile than the S&P 500.
Simmons First National pays an annual dividend of $0.60 per share and has a dividend yield of 2.0%. Chemung Financial pays an annual dividend of $1.04 per share and has a dividend yield of 2.3%. Simmons First National pays out 43.8% of its earnings in the form of a dividend. Chemung Financial pays out 67.1% 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.
Earnings and Valuation
This table compares Simmons First National and Chemung Financial’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Simmons First National||$533.77 million||5.28||$92.94 million||$1.37||22.30|
|Chemung Financial||$80.55 million||2.70||$7.43 million||$1.55||29.46|
Simmons First National has higher revenue and earnings than Chemung Financial. Simmons First National is trading at a lower price-to-earnings ratio than Chemung Financial, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and recommmendations for Simmons First National and Chemung Financial, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Simmons First National||0||3||2||0||2.40|
Simmons First National presently has a consensus price target of $31.63, suggesting a potential upside of 3.52%. Chemung Financial has a consensus price target of $51.00, suggesting a potential upside of 11.67%. Given Chemung Financial’s stronger consensus rating and higher possible upside, analysts plainly believe Chemung Financial is more favorable than Simmons First National.
Insider & Institutional Ownership
15.1% of Simmons First National shares are held by institutional investors. Comparatively, 32.3% of Chemung Financial shares are held by institutional investors. 4.6% of Simmons First National shares are held by company insiders. Comparatively, 22.3% of Chemung Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This table compares Simmons First National and Chemung Financial’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Simmons First National||17.41%||8.28%||1.13%|
Simmons First National beats Chemung Financial on 9 of the 16 factors compared between the two stocks.
About Simmons First National
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.
About Chemung Financial
Chemung Financial Corporation is a bank holding company. The Company, through its subsidiaries, Chemung Canal Trust Company (the Bank) and CFS Group, Inc. (CFS), provides a range of banking, financing, fiduciary and other financial services to its clients. The Company manages its operations through two segments: core banking and Wealth Management Group (WMG). The core banking segment receives deposits from the general public and uses such funds to originate consumer, commercial, commercial real estate and residential mortgage loans, mainly in its local markets and to invest in securities. The WMG services segment provides trust and investment advisory services to clients. The Company’s financial services include demand, savings and time deposits, commercial, residential and consumer loans, interest rate swaps, letters of credit, wealth management services, employee benefit plans, insurance products, mutual funds and brokerage services.
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