Contrasting Southside Bancshares (NYSE:SBSI) and PCB Bancorp (NASDAQ:PCB)

PCB Bancorp (NASDAQ:PCB) and Southside Bancshares (NYSE:SBSI) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, earnings, analyst recommendations, profitability and risk.

Institutional & Insider Ownership

33.0% of PCB Bancorp shares are held by institutional investors. Comparatively, 55.7% of Southside Bancshares shares are held by institutional investors. 25.9% of PCB Bancorp shares are held by insiders. Comparatively, 6.0% of Southside Bancshares shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares PCB Bancorp and Southside Bancshares”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PCB Bancorp	$112.75 million	2.75	$25.81 million	$2.39	9.05
Southside Bancshares	$240.20 million	3.60	$88.49 million	$2.30	12.51

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

Analyst Recommendations

This is a summary of recent ratings for PCB Bancorp and Southside Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PCB Bancorp	0	2	1	0	2.33
Southside Bancshares	0	1	0	0	2.00

PCB Bancorp presently has a consensus target price of $24.50, suggesting a potential upside of 13.27%. Given PCB Bancorp’s stronger consensus rating and higher probable upside, equities research analysts clearly believe PCB Bancorp is more favorable than Southside Bancshares.

Dividends

PCB Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 3.7%. Southside Bancshares pays an annual dividend of $1.44 per share and has a dividend yield of 5.0%. PCB Bancorp pays out 33.5% of its earnings in the form of a dividend. Southside Bancshares pays out 62.6% 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. PCB Bancorp has increased its dividend for 7 consecutive years and Southside Bancshares has increased its dividend for 30 consecutive years. Southside Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares PCB Bancorp and Southside Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PCB Bancorp	17.08%	11.70%	1.11%
Southside Bancshares	15.58%	10.94%	1.07%

Risk & Volatility

PCB Bancorp has a beta of 0.6, suggesting that its share price is 40% less volatile than the S&P 500. Comparatively, Southside Bancshares has a beta of 0.68, suggesting that its share price is 32% less volatile than the S&P 500.

Summary

PCB Bancorp beats Southside Bancshares on 9 of the 17 factors compared between the two stocks.

About PCB Bancorp

PCB Bancorp operates as the bank holding company for PCB Bank that provides various banking products and services to small to medium-sized businesses, individuals, and professionals in Southern California. The company offers demand, savings, money market, and time deposits, as well as certificates of deposit; and trade finance, remote deposit capture, courier deposit services, positive pay services, zero balance accounts, and sweep accounts. It also provides real estate loans, including commercial and residential, Small Business Administration (SBA) property, and construction loans; commercial and industrial loans, such as commercial term and lines of credit, SBA commercial term, and SBA Paycheck Protection Program loans; and consumer loans comprising residential mortgage; and automobile loans, unsecured lines of credit, and term loans. In addition, the company offers access to account balances, online transfers, and online bill payment and electronic delivery of customer statements; and mobile banking solutions that include remote check deposit and mobile bill pay. Further, it provides automated teller machines; and banking by telephone, mail, personal appointment, debit cards, direct deposit, and cashier's checks, as well as treasury management, wire transfer, and automated clearing house services. The company operates through a network of full-service branches in Los Angeles and Orange counties, California; Carrollton and Dallas, Texas; and Englewood Cliffs and Palisade Park, New Jersey, and Bayside, New York. It also operates loan production offices in Los Angeles and Orange Counties, California; Annandale, Virginia; Atlanta, Georgia; Bellevue, Washington; Aurora, Colorado; and Carrollton, Texas. The company was formerly known as Pacific City Financial Corporation and changed its name to PCB Bancorp in July 2019. PCB Bancorp was founded in 2003 and is headquartered in Los Angeles, California.

About Southside Bancshares

Southside Bancshares, Inc. operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations. Its deposit products include savings, money market, and interest and noninterest bearing checking accounts, as well as certificates of deposit. The company’s loan portfolio comprises consumer loans that include 1-4 family residential loans, home equity loans, home improvement loans, automobile loans, and other consumer related loans; commercial loans, such as short-term working capital loans for inventory and accounts receivable, short and medium-term loans for equipment or other business capital expansion, commercial real estate loans, and municipal loans; and construction loans for 1-4 family residential and commercial real estate. It also offers wealth management and trust services consisting of investment management, administration, revocable and testamentary trusts, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. As of December 31, 2021, the company operated through 56 banking facilities and 73 ATMs/ITMs. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.