Head-To-Head Analysis: South Plains Financial (NASDAQ:SPFI) & Republic Bancorp (NASDAQ:RBCAA)

South Plains Financial (NASDAQ:SPFI) and Republic Bancorp (NASDAQ:RBCAA) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, dividends, institutional ownership, risk, valuation, analyst recommendations and earnings.

Volatility & Risk

South Plains Financial has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500. Comparatively, Republic Bancorp has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.

Institutional and Insider Ownership

55.0% of South Plains Financial shares are held by institutional investors. Comparatively, 24.4% of Republic Bancorp shares are held by institutional investors. 25.4% of South Plains Financial shares are held by insiders. Comparatively, 56.4% of Republic Bancorp shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

South Plains Financial pays an annual dividend of $0.64 per share and has a dividend yield of 1.7%. Republic Bancorp pays an annual dividend of $1.80 per share and has a dividend yield of 2.7%. South Plains Financial pays out 18.3% of its earnings in the form of a dividend. Republic Bancorp pays out 27.6% 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. South Plains Financial has increased its dividend for 5 consecutive years and Republic Bancorp has increased its dividend for 27 consecutive years. Republic Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares South Plains Financial and Republic Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
South Plains Financial	20.09%	13.16%	1.37%
Republic Bancorp	24.53%	12.40%	1.83%

Analyst Recommendations

This is a summary of recent recommendations and price targets for South Plains Financial and Republic Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
South Plains Financial	0	2	4	0	2.67
Republic Bancorp	0	2	1	0	2.33

South Plains Financial presently has a consensus price target of $44.00, indicating a potential upside of 19.50%. Republic Bancorp has a consensus price target of $69.00, indicating a potential upside of 5.07%. Given South Plains Financial’s stronger consensus rating and higher possible upside, research analysts plainly believe South Plains Financial is more favorable than Republic Bancorp.

Valuation and Earnings

This table compares South Plains Financial and Republic Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
South Plains Financial	$288.97 million	2.07	$49.72 million	$3.50	10.52
Republic Bancorp	$406.38 million	3.16	$101.37 million	$6.53	10.06

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

Summary

Republic Bancorp beats South Plains Financial on 9 of the 17 factors compared between the two stocks.

About South Plains Financial

South Plains Financial, Inc. operates as a bank holding company for City Bank that provides commercial and consumer financial services to small and medium-sized businesses and individuals. The company operates through two segments, Banking and Insurance. It offers deposit products, including demand deposit accounts, interest-bearing products, savings accounts, and certificate of deposits. The company also provides commercial real estate loans; general and specialized commercial loans, including agricultural production and real estate, energy, finance, investment, and insurance loans, as well as loans to goods, services, restaurant and retail, construction, and other industries; residential construction loans; and 1-4 family residential loans, auto loans, and other loans for recreational vehicles or other purposes. In addition, it offers crop insurance products; trust products and services; investment services; mortgage banking services; online and mobile banking services; and debit and credit cards. The company was founded in 1941 and is headquartered in Lubbock, Texas.

About Republic Bancorp

Republic Bancorp, Inc. operates as a bank holding company for Republic Bank & Trust Company that provides various banking products and services in the United States. It operates in six segments: Traditional Banking, Warehouse, Mortgage Banking, Tax Refund Solutions, Republic Payment Solutions, and Republic Credit Solutions. The company offers demand, money market accounts, savings, individual retirement accounts, time, brokered, and other certificates of deposit; and retail and commercial mortgage, construction and land development, consumer, aircraft, and marine loans. It also provides credit cards; title insurance and other financial products and services; and private banking, lockbox processing, remote deposit capture, business online banking, account reconciliation, automated clearing house processing, and internet and mobile banking services. In addition, it offers short-term and revolving credit facilities to mortgage bankers through mortgage warehouse lines of credit; mortgage banking; tax refund solutions, which facilitate the receipt and payment of federal and state tax refund products through third-party tax preparers and tax-preparation software providers; payments-related products and services to consumers through third party service providers; and consumer credit products. The company offers its services through full-services banking centers in Kentucky, Indiana, Florida, Ohio, and Tennessee. Republic Bancorp, Inc. was incorporated in 1974 and is headquartered in Louisville, Kentucky.