Analyzing First Community Bancshares (NASDAQ:FCBC) and Southern First Bancshares (NASDAQ:SFST)

First Community Bancshares (NASDAQ:FCBC) and Southern First Bancshares (NASDAQ:SFST) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their valuation, dividends, profitability, institutional ownership, risk, analyst recommendations and earnings.

Analyst Recommendations

This is a summary of recent ratings for First Community Bancshares and Southern First Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Community Bancshares	0	0	1	0	3.00
Southern First Bancshares	0	1	2	0	2.67

Southern First Bancshares has a consensus target price of $64.00, suggesting a potential upside of 4.52%. Given Southern First Bancshares’ higher probable upside, analysts clearly believe Southern First Bancshares is more favorable than First Community Bancshares.

Volatility and Risk

First Community Bancshares has a beta of 0.48, meaning that its share price is 52% less volatile than the S&P 500. Comparatively, Southern First Bancshares has a beta of 0.68, meaning that its share price is 32% less volatile than the S&P 500.

Profitability

This table compares First Community Bancshares and Southern First Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Community Bancshares	25.89%	10.44%	1.60%
Southern First Bancshares	15.21%	9.65%	0.79%

Insider & Institutional Ownership

35.0% of First Community Bancshares shares are owned by institutional investors. Comparatively, 75.0% of Southern First Bancshares shares are owned by institutional investors. 3.7% of First Community Bancshares shares are owned by company insiders. Comparatively, 6.9% of Southern First Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares First Community Bancshares and Southern First Bancshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Community Bancshares	$185.42 million	4.60	$48.79 million	$2.65	17.05
Southern First Bancshares	$224.62 million	2.58	$30.37 million	$4.28	14.31

First Community Bancshares has higher earnings, but lower revenue than Southern First Bancshares. Southern First Bancshares is trading at a lower price-to-earnings ratio than First Community Bancshares, indicating that it is currently the more affordable of the two stocks.

About First Community Bancshares

First Community Bankshares, Inc. operates as the financial holding company for First Community Bank that provides various banking products and services. It offers demand deposit accounts, savings and money market accounts, certificates of deposit, and individual retirement plans; and commercial, consumer real estate, and consumer and other loans. The company also provides trust management, estate administration, and investment advisory services; and investment management services. It serves individuals and businesses across various industries, such as education, government, and health services; coal mining and gas extraction; retail trade; construction; manufacturing; tourism; and transportation. The company operates through branches in West Virginia, Virginia, North Carolina, and Tennessee. Community Bankshares, Inc. was founded in 1874 and is headquartered in Bluefield, Virginia.

About Southern First Bancshares

Southern First Bancshares, Inc. operates as the bank holding company for Southern First Bank that provides commercial, consumer, and mortgage loans to the general public in South Carolina, North Carolina, and Georgia. The company accepts various deposit products that include checking accounts, commercial checking accounts, and savings accounts, as well as other time deposits, including daily money market accounts and long-term certificates of deposit. Its loan portfolio comprises commercial real estate loans; construction real estate loans; commercial business loans for various lines of businesses, such as the manufacturing, service industry, and professional service areas; consumer real estate and home equity loans; and other consumer loans, including secured and unsecured installment loans and revolving lines of credit. In addition, the company provides other bank services, such as internet banking, cash management, safe deposit boxes, direct deposit, automatic drafts, bill payment, and mobile banking services. Southern First Bancshares, Inc. was incorporated in 1999 and is headquartered in Greenville, South Carolina.