Reviewing National Bankshares (NASDAQ:NKSH) and Kentucky Bancshares (OTCMKTS:KTYB)

Kentucky Bancshares (OTCMKTS:KTYB) and National Bankshares (NASDAQ:NKSH) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, valuation, institutional ownership, earnings, profitability, risk and analyst recommendations.

Analyst Ratings

This is a breakdown of current ratings for Kentucky Bancshares and National Bankshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kentucky Bancshares	0	0	0	0	0.00
National Bankshares	0	0	1	0	3.00

National Bankshares has a consensus price target of $38.00, suggesting a potential upside of 50.26%. Given National Bankshares’ stronger consensus rating and higher possible upside, analysts clearly believe National Bankshares is more favorable than Kentucky Bancshares.

Earnings and Valuation

This table compares Kentucky Bancshares and National Bankshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kentucky Bancshares	N/A	N/A	N/A	N/A	N/A
National Bankshares	$47.72 million	3.37	$7.62 million	$1.36	18.60

National Bankshares has higher revenue and earnings than Kentucky Bancshares.

Profitability

This table compares Kentucky Bancshares and National Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kentucky Bancshares	N/A	N/A	N/A
National Bankshares	10.64%	5.31%	0.47%

Institutional and Insider Ownership

29.7% of National Bankshares shares are held by institutional investors. 15.0% of Kentucky Bancshares shares are held by company insiders. Comparatively, 3.2% of National Bankshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

National Bankshares beats Kentucky Bancshares on 8 of the 9 factors compared between the two stocks.

About Kentucky Bancshares

Kentucky Bancshares, Inc. operates as the bank holding company for Kentucky Bank that provides commercial and consumer banking products and services. It accepts various deposit products, including checking, savings, and money market accounts; and certificates of deposit, safe deposits, interest and noninterest bearing deposits, and time deposits. The company also offers commercial, agricultural, and real estate loans to small-to-medium-sized industrial, service, and agricultural businesses; and residential mortgages, installments, and other loans to individual and other non-commercial customers. In addition, it provides credit cards and other consumer-oriented financial services; brokerage services, annuities, life and long-term care insurance, personal trust, and agency services; and Internet banking services, such as bill payment. The company has operations in Bourbon, Clark, Elliott, Fayette, Harrison, Jessamine, Madison, Rowan, Scott, Woodford, and other counties in Kentucky. Kentucky Bancshares, Inc. was founded in 1851 and is headquartered in Paris, Kentucky.

About National Bankshares

National Bankshares, Inc. operates as the bank holding company for the National Bank of Blacksburg that provides retail and commercial banking products and services to individuals, businesses, non-profits, and local governments. The company accepts interest-bearing and non-interest-bearing demand deposit accounts, money market deposit accounts, savings accounts, certificates of deposit, health savings accounts, and individual retirement accounts. Its loan products include commercial and agricultural, commercial real estate, residential real estate, home equity, and various consumer loan products, as well as loans for the construction of commercial and residential properties. The company also provides business and consumer debit and credit cards; letters of credit, night depository services, safe deposit boxes, utility payment services, and automatic funds transfer; wealth management, trust, and estate services; non-deposit investment and insurance products; and telephone, mobile, and Internet banking services. The company was founded in 1891 and is headquartered in Blacksburg, Virginia.