Reviewing First Guaranty Bancshares (NASDAQ:FGBI) and United Bankshares (NASDAQ:UBSI)

First Guaranty Bancshares (NASDAQ:FGBI) and United Bankshares (NASDAQ:UBSI) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, dividends, earnings and valuation.

Dividends

First Guaranty Bancshares pays an annual dividend of $0.04 per share and has a dividend yield of 0.5%. United Bankshares pays an annual dividend of $1.48 per share and has a dividend yield of 3.9%. First Guaranty Bancshares pays out -4.0% of its earnings in the form of a dividend. United Bankshares pays out 52.3% 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 Bankshares has raised its dividend for 26 consecutive years. United Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of recent ratings and target prices for First Guaranty Bancshares and United Bankshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Guaranty Bancshares	0	1	0	0	2.00
United Bankshares	0	4	0	0	2.00

United Bankshares has a consensus price target of $40.50, suggesting a potential upside of 5.63%. Given United Bankshares’ higher probable upside, analysts plainly believe United Bankshares is more favorable than First Guaranty Bancshares.

Risk and Volatility

First Guaranty Bancshares has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500. Comparatively, United Bankshares has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500.

Profitability

This table compares First Guaranty Bancshares and United Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Guaranty Bancshares	-4.49%	-4.73%	-0.27%
United Bankshares	23.14%	7.65%	1.26%

Valuation and Earnings

This table compares First Guaranty Bancshares and United Bankshares”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Guaranty Bancshares	$246.45 million	0.52	$12.45 million	($1.01)	-8.34
United Bankshares	$1.63 billion	3.34	$373.00 million	$2.83	13.55

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

Insider and Institutional Ownership

39.5% of First Guaranty Bancshares shares are owned by institutional investors. Comparatively, 70.8% of United Bankshares shares are owned by institutional investors. 47.2% of First Guaranty Bancshares shares are owned by company insiders. Comparatively, 3.7% of United Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

United Bankshares beats First Guaranty Bancshares on 13 of the 15 factors compared between the two stocks.

About First Guaranty Bancshares

First Guaranty Bancshares, Inc. operates as the holding company for First Guaranty Bank that provides commercial banking services in Louisiana and Texas. It offers various deposit products, including personal and business checking, savings, money market, and demand accounts, as well as time deposits to consumers, small businesses, and municipalities. The company provides loans, such as non-farm, non-residential loans secured by real estate, commercial and industrial loans, one- to four-family residential loans, multifamily loans, construction and land development loans, agricultural loans, farmland loans, and consumer and other loans to small to medium-sized businesses and professionals, and individuals. In addition, it offers a range of consumer services, including credit cards, mobile deposit capture, safe deposit boxes, official checks, online and mobile banking, automated teller machines, and online bill pay; provides additional solutions, such as merchant services, remote deposit capture, and lockbox services to business customers; and invests a portion of its assets in securities issued by the United States Government and its agencies, state and municipal obligations, corporate debt securities, mutual funds, and equity securities, as well as invests in mortgage-backed securities primarily issued or guaranteed by United States Government agencies or enterprises. First Guaranty Bancshares, Inc. was founded in 1934 and is headquartered in Hammond, Louisiana.

About United Bankshares

United Bankshares, Inc., through its subsidiaries, primarily provides commercial and retail banking products and services in the United States. It operates through two segments, Community Banking and Mortgage Banking. The company accepts checking, savings, and time and money market accounts; individual retirement accounts; and demand deposits, statement and special savings, and NOW accounts. Its loan products include commercial loans and leases to small to mid-size industrial and commercial companies; construction and real estate loans, such as commercial and residential mortgages, and loans secured by owner-occupied real estate; personal, student, credit card receivables, personal, commercial, and floor plan loans; and home equity loans. In addition, the company provides credit cards; safe deposit boxes, wire transfers, and other banking products and services; investment and security services; services to correspondent banks, including buying and selling federal funds; automated teller machine services; and internet and telephone banking services. Further, it offers community banking services, such as asset management, real property title insurance, financial planning, mortgage banking, and brokerage services, as well as investment management and retirement planning services. United Bankshares, Inc. was incorporated in 1982 and is headquartered in Charleston, West Virginia.