United Bancorp (NASDAQ:UBCP) and Beacon Financial (NYSE:BBT) Critical Survey

Beacon Financial (NYSE:BBT) and United Bancorp (NASDAQ:UBCP) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, valuation, dividends, analyst recommendations, institutional ownership and profitability.

Dividends

Beacon Financial pays an annual dividend of $1.29 per share and has a dividend yield of 4.2%. United Bancorp pays an annual dividend of $0.79 per share and has a dividend yield of 5.5%. Beacon Financial pays out 48.0% of its earnings in the form of a dividend. United Bancorp pays out 61.2% 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. United Bancorp has raised its dividend for 13 consecutive years. United Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Beacon Financial has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, United Bancorp has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500.

Profitability

This table compares Beacon Financial and United Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Beacon Financial	17.33%	10.09%	1.13%
United Bancorp	15.14%	10.63%	0.86%

Earnings & Valuation

This table compares Beacon Financial and United Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Beacon Financial	$882.75 million	2.94	$90.27 million	$2.69	11.50
United Bancorp	$47.51 million	1.73	$7.75 million	$1.29	11.08

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Beacon Financial and United Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Beacon Financial	0	4	3	0	2.43
United Bancorp	0	1	0	0	2.00

Beacon Financial currently has a consensus price target of $32.75, suggesting a potential upside of 5.82%. Given Beacon Financial’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Beacon Financial is more favorable than United Bancorp.

Institutional and Insider Ownership

83.1% of Beacon Financial shares are owned by institutional investors. Comparatively, 15.4% of United Bancorp shares are owned by institutional investors. 1.1% of Beacon Financial shares are owned by company insiders. Comparatively, 13.9% of United Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Beacon Financial beats United Bancorp on 13 of the 17 factors compared between the two stocks.

About Beacon Financial

I could not verify a company named Beacon Financial trading on the NYSE under the symbol BBT. That ticker was formerly used by BB&T Corporation, a U.S. financial services company. BB&T provided commercial and consumer banking, insurance, wealth management, mortgage and investment services. It merged with SunTrust Banks in 2019 to form Truist Financial, and BBT is no longer its ticker.

About United Bancorp

United Bancorp, Inc. is a bank holding company headquartered in Martins Ferry, Ohio. Through its subsidiary, The Citizens Bank, National Association, the company provides community banking services to individuals, families, farmers, and businesses. The Citizens Bank offers a range of deposit products, including checking, savings, money market, and certificate of deposit accounts. Its lending activities include residential and commercial real estate loans, consumer loans, agricultural financing, and loans to small and middle-market businesses.