Head-To-Head Contrast: Fannie Mae (OTCMKTS:FNMA) vs. First Citizens BancShares (NASDAQ:FCNCA)

First Citizens BancShares (NASDAQ:FCNCA) and Fannie Mae (OTCMKTS:FNMA) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, earnings, valuation, risk, dividends, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a summary of recent recommendations for First Citizens BancShares and Fannie Mae, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Citizens BancShares	1	10	2	1	2.21
Fannie Mae	1	5	0	0	1.83

First Citizens BancShares presently has a consensus target price of $2,355.31, suggesting a potential upside of 1.73%. Fannie Mae has a consensus target price of $7.30, suggesting a potential upside of 68.98%. Given Fannie Mae’s higher probable upside, analysts plainly believe Fannie Mae is more favorable than First Citizens BancShares.

Profitability

This table compares First Citizens BancShares and Fannie Mae’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Citizens BancShares	16.54%	12.49%	1.09%
Fannie Mae	5.16%	-88.54%	0.52%

Insider and Institutional Ownership

78.0% of First Citizens BancShares shares are held by institutional investors. Comparatively, 0.0% of Fannie Mae shares are held by institutional investors. 14.6% of First Citizens BancShares shares are held by company insiders. Comparatively, 1.0% of Fannie Mae shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares First Citizens BancShares and Fannie Mae”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Citizens BancShares	$14.51 billion	1.80	$2.21 billion	$195.19	11.86
Fannie Mae	$159.17 billion	0.03	$14.36 billion	$0.22	19.64

Fannie Mae has higher revenue and earnings than First Citizens BancShares. First Citizens BancShares is trading at a lower price-to-earnings ratio than Fannie Mae, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

First Citizens BancShares has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500. Comparatively, Fannie Mae has a beta of 1.72, indicating that its stock price is 72% more volatile than the S&P 500.

Summary

First Citizens BancShares beats Fannie Mae on 10 of the 15 factors compared between the two stocks.

About First Citizens BancShares

First Citizens BancShares is a bank holding company headquartered in Raleigh, North Carolina, and the parent of First Citizens Bank. The company provides commercial and consumer banking services, including deposit accounts, loans, payment services, and wealth management, to individuals, businesses, and institutions. Founded in 1898 as the Bank of Smithfield, the company grew from its North Carolina roots into a banking organization serving customers across the United States. Its operations include First Citizens Bank and Silicon Valley Bank, which became part of the company after it acquired substantially all of Silicon Valley Bank’s deposits and loans from the Federal Deposit Insurance Corporation in 2023.

About Fannie Mae

Fannie Mae, formally the Federal National Mortgage Association, is a U.S. government-sponsored enterprise that supports the secondary mortgage market. Founded in 1938, the company generally does not make mortgage loans directly to borrowers. Instead, it purchases eligible mortgages from lenders, helping those lenders replenish funds for additional home loans. Fannie Mae also packages many of the mortgages it acquires into mortgage-backed securities and guarantees investors timely payment of principal and interest, subject to the terms of those securities.