Critical Comparison: First Us Bancsh (NASDAQ:FUSB) and Community Trust Bancorp (NASDAQ:CTBI)

First Us Bancsh (NASDAQ:FUSB) and Community Trust Bancorp (NASDAQ:CTBI) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, valuation, dividends and analyst recommendations.

Insider and Institutional Ownership

18.7% of First Us Bancsh shares are held by institutional investors. Comparatively, 60.2% of Community Trust Bancorp shares are held by institutional investors. 12.1% of First Us Bancsh shares are held by company insiders. Comparatively, 2.6% of Community Trust Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares First Us Bancsh and Community Trust Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Us Bancsh	12.10%	7.41%	0.67%
Community Trust Bancorp	25.48%	12.60%	1.62%

Analyst Ratings

This is a breakdown of recent ratings and price targets for First Us Bancsh and Community Trust Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Us Bancsh	0	0	0	1	4.00
Community Trust Bancorp	0	2	1	1	2.75

Community Trust Bancorp has a consensus target price of $78.50, indicating a potential upside of 11.35%. Given Community Trust Bancorp’s higher probable upside, analysts clearly believe Community Trust Bancorp is more favorable than First Us Bancsh.

Volatility and Risk

First Us Bancsh has a beta of 0.23, meaning that its stock price is 77% less volatile than the S&P 500. Comparatively, Community Trust Bancorp has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500.

Valuation and Earnings

This table compares First Us Bancsh and Community Trust Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Us Bancsh	$41.81 million	2.18	$5.99 million	$1.32	12.55
Community Trust Bancorp	$409.34 million	3.13	$98.06 million	$5.97	11.81

Community Trust Bancorp has higher revenue and earnings than First Us Bancsh. Community Trust Bancorp is trading at a lower price-to-earnings ratio than First Us Bancsh, indicating that it is currently the more affordable of the two stocks.

Dividends

First Us Bancsh pays an annual dividend of $0.28 per share and has a dividend yield of 1.7%. Community Trust Bancorp pays an annual dividend of $2.60 per share and has a dividend yield of 3.7%. First Us Bancsh pays out 21.2% of its earnings in the form of a dividend. Community Trust Bancorp pays out 43.6% 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. First Us Bancsh has raised its dividend for 3 consecutive years and Community Trust Bancorp has raised its dividend for 44 consecutive years. Community Trust Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Community Trust Bancorp beats First Us Bancsh on 13 of the 17 factors compared between the two stocks.

About First Us Bancsh

First US Bancshares, Inc. operates as the bank holding company for First US Bank that provides commercial banking products and services. The company offers non-interest-bearing demand deposits, savings accounts, NOW accounts, money market demand accounts, individual retirement accounts, and time deposits. Its loan products include commercial construction, land, and land development loans, including residential housing projects, commercial and industrial development, and for purchase and improvement of raw land for agricultural production; mortgage loans on one-to-four family and multi-family residential properties; real estate loans secured by commercial and industrial properties, office or mixed-use facilities, strip shopping centers, and other commercial properties; commercial and industrial loans and leases; and secured and unsecured personal loans, including automobile loans, loans for household and personal purposes, and other direct consumer installment loans. The company also provides loans secured by collateral in form of personal property items. In addition, it provides letters of credit; and safe deposit box and remote deposit capture services. The company serves small-and medium-sized businesses, property managers, business executives, professionals, and other individuals. The company was formerly known as United Security Bancshares, Inc. and changed its name to First US Bancshares, Inc. in October 2016. First US Bancshares, Inc. was founded in 1952 and is headquartered in Birmingham, Alabama.

About Community Trust Bancorp

Community Trust Bancorp, Inc. operates as the bank holding company for Community Trust Bank, Inc. that engages in the provision of commercial and personal banking, and trust and wealth management services to small and mid-sized communities in eastern, northeastern, central, and south-central Kentucky, as well as southern West Virginia, and northeastern Tennessee. The company accepts time and demand deposits, checking accounts, savings accounts and savings certificates, individual retirement accounts and Keogh plans, and money market accounts. Its loan portfolio includes commercial, construction, mortgage, and personal loans; lease-financing, lines of credit, revolving lines of credit, and term loans, as well as other specialized loans, including asset-based financing; residential and commercial real estate loans; and consumer loans. The company also provides cash management, renting safe deposit boxes, and funds transfer services; issues letters of credit; and acts as a trustee of personal trusts, executor of estates, trustee for employee benefit trusts, and paying agent for bond and stock issues, as well as an investment agent and depositor for securities. In addition, it offers securities brokerage services; debit cards; annuity and life insurance products; and repurchase agreements, as well as mobile, internet banking, and e-statement services. The company was founded in 1903 and is headquartered in Pikeville, Kentucky.