Salisbury Bancorp (NASDAQ: SAL) and Independent Bank Group (NASDAQ:IBTX) are both financials companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, earnings, profitability, analyst recommendations, risk, institutional ownership and valuation.
This is a breakdown of recent recommendations and price targets for Salisbury Bancorp and Independent Bank Group, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Independent Bank Group||0||1||5||0||2.83|
Institutional & Insider Ownership
9.9% of Salisbury Bancorp shares are held by institutional investors. Comparatively, 47.7% of Independent Bank Group shares are held by institutional investors. 19.1% of Salisbury Bancorp shares are held by insiders. Comparatively, 7.7% of Independent Bank Group shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Salisbury Bancorp pays an annual dividend of $1.12 per share and has a dividend yield of 2.5%. Independent Bank Group pays an annual dividend of $0.40 per share and has a dividend yield of 0.5%. Salisbury Bancorp pays out 46.7% of its earnings in the form of a dividend. Independent Bank Group pays out 13.7% 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.
Volatility and Risk
Salisbury Bancorp has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500. Comparatively, Independent Bank Group has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500.
This table compares Salisbury Bancorp and Independent Bank Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Independent Bank Group||23.46%||8.11%||1.08%|
Earnings and Valuation
This table compares Salisbury Bancorp and Independent Bank Group’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Salisbury Bancorp||$42.35 million||3.00||$6.68 million||$2.40||18.99|
|Independent Bank Group||$229.60 million||8.99||$53.54 million||$2.91||25.15|
Independent Bank Group has higher revenue and earnings than Salisbury Bancorp. Salisbury Bancorp is trading at a lower price-to-earnings ratio than Independent Bank Group, indicating that it is currently the more affordable of the two stocks.
Independent Bank Group beats Salisbury Bancorp on 12 of the 16 factors compared between the two stocks.
About Salisbury Bancorp
Salisbury Bancorp, Inc. is a bank holding company for Salisbury Bank and Trust Company (the Bank). The Bank is a Connecticut-chartered and Federal Deposit Insurance Corporation (the FDIC) insured commercial bank. The Bank provides commercial banking, consumer financing, retail banking and trust and wealth advisory services through a network of over 10 banking offices and approximately nine automated teller machines (ATMs). The Bank originates commercial loans, commercial real estate loans, residential and commercial construction loans, residential real estate loans collateralized by one- to four- family residences, home equity lines of credit, fixed rate loans and other consumer loans. The Bank’s securities portfolio include the United States Government and Agency securities, mortgage-backed securities, collateralized mortgage obligations and tax exempt municipal bonds. The Bank uses deposits, repayments and sales, and borrowings to fund lending, investing and general operations.
About Independent Bank Group
Independent Bank Group, Inc. is a bank holding company. Through the Company’s subsidiary, Independent Bank (the Bank), the Company provides a range of commercial banking products and services tailored to meet the needs of businesses, professionals and individuals. As of December 31, 2016, the Company operated 41 banking offices in the Dallas/North Texas area, the Austin/Central Texas area, and the Houston metropolitan area. The Company offers residential mortgages through its mortgage brokerage division. As a mortgage broker, the Company originates residential mortgages, which are sold into the secondary market shortly after closing. The Company also provides wealth management services to its customers, including investment advisory and other related services. The Company offers a range of commercial and retail lending products to businesses, professionals and individuals. Deposits are the Company’s principal source of funds for use in lending and other general banking purposes.
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