Head to Head Survey: Shore Bancshares (NASDAQ:SHBI) & Union Bankshares (NASDAQ:UNB)

Union Bankshares (NASDAQ:UNB) and Shore Bancshares (NASDAQ:SHBI) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.

Dividends

Union Bankshares pays an annual dividend of $1.44 per share and has a dividend yield of 6.1%. Shore Bancshares pays an annual dividend of $0.48 per share and has a dividend yield of 2.6%. Union Bankshares pays out 57.6% of its earnings in the form of a dividend. Shore Bancshares pays out 28.2% 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.

Profitability

This table compares Union Bankshares and Shore Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Union Bankshares	13.16%	15.88%	0.74%
Shore Bancshares	16.78%	11.25%	1.02%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Union Bankshares and Shore Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Union Bankshares	0	1	0	0	2.00
Shore Bancshares	0	2	2	0	2.50

Shore Bancshares has a consensus target price of $18.75, suggesting a potential upside of 0.00%. Given Shore Bancshares’ stronger consensus rating and higher possible upside, analysts clearly believe Shore Bancshares is more favorable than Union Bankshares.

Earnings & Valuation

This table compares Union Bankshares and Shore Bancshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Union Bankshares	$77.68 million	1.40	$8.76 million	$2.50	9.49
Shore Bancshares	$326.48 million	1.92	$43.89 million	$1.70	11.03

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

Institutional and Insider Ownership

14.8% of Union Bankshares shares are owned by institutional investors. Comparatively, 59.8% of Shore Bancshares shares are owned by institutional investors. 1.1% of Union Bankshares shares are owned by insiders. Comparatively, 8.6% of Shore Bancshares shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Risk and Volatility

Union Bankshares has a beta of 0.38, suggesting that its stock price is 62% less volatile than the S&P 500. Comparatively, Shore Bancshares has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500.

Summary

Shore Bancshares beats Union Bankshares on 13 of the 16 factors compared between the two stocks.

About Union Bankshares

Union Bankshares, Inc. operates as the bank holding company for Union Bank that provides retail, commercial, and municipal banking products and services in northern Vermont and New Hampshire. It offers retail depository services, such as personal checking, savings, money market, IRA/SEP/KEOGH, and health savings accounts, as well as certificates of deposit. The company also provides commercial real estate loans; commercial loans for plant and equipment, working capital, real estate renovation, and other business purposes to business owners and investors; small business administration guaranteed loans; residential construction and mortgage loans; municipal financing, including loans and excess deposits secured by FHLBB letters of credit; and home improvement loans and overdraft checking privileges against preauthorized lines of credit. In addition, it offers online cash management services, including account reconciliation, credit card depository, automated clearing house origination, wire transfers, positive pay and night depository services; merchant credit card services for the deposit and immediate credit of sales drafts; remote deposit capture services; and online mortgage application and consumer deposit account opening services. Further, the company provides business checking accounts; standby letters of credit, bank checks or money orders, and safe deposit boxes; ATM cards and services; debit cards; telephone, internet, and mobile banking services, including bill pay; and wealth management, fiduciary, and trust services. It offers retail banking services to individuals; and commercial banking services to small and medium sized business corporations, limited liability companies, partnerships, and sole proprietorships, as well as nonprofit organizations, local municipalities, and school districts. Union Bankshares, Inc. was founded in 1891 and is headquartered in Morrisville, Vermont.

About Shore Bancshares

Shore Bancshares, Inc. operates as a bank holding company for the Shore United Bank, N.A. that provides various commercial and consumer banking products and services to individuals, businesses, and other organizations. It offers checking, savings, overnight investment sweep, and money market accounts; and regular and IRA certificates of deposit, as well as CDARS programs and cash management services. The company also provides commercial loans, such as secured and unsecured loans, working capital loans, lines of credit, term loans, accounts receivable financing, real estate acquisition and development loans, construction loans, and letters of credit; residential real estate construction loans; residential mortgage loans; and loans to consumers, including home equity, automobile, installment, home improvement, and personal lines of credit, as well as other consumer financing products. In addition, it offers trust, asset management, and financial planning services; treasury management services, such as merchant card processing, remote deposit capture, and ACH origination, as well as telephone, mobile, and Internet banking services; safe deposit boxes; debit and credit cards; and automatic teller machine services. Shore Bancshares, Inc. was founded in 1876 and is headquartered in Easton, Maryland.