Comparing South Atlantic Bancshares (OTCMKTS:SABK) and Home Bancorp (NASDAQ:HBCP)

Home Bancorp (NASDAQ:HBCP) and South Atlantic Bancshares (OTCMKTS:SABK) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, risk, valuation, dividends and profitability.

Dividends

Home Bancorp pays an annual dividend of $1.24 per share and has a dividend yield of 1.9%. South Atlantic Bancshares pays an annual dividend of $0.10 per share and has a dividend yield of 0.4%. Home Bancorp pays out 21.1% of its earnings in the form of a dividend. South Atlantic Bancshares pays out 4.8% 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. Home Bancorp has raised its dividend for 10 consecutive years. Home Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Home Bancorp and South Atlantic Bancshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Home Bancorp	$148.72 million	3.41	$46.06 million	$5.87	11.02
South Atlantic Bancshares	$102.25 million	1.68	$15.94 million	$2.10	10.79

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

Insider and Institutional Ownership

49.4% of Home Bancorp shares are owned by institutional investors. Comparatively, 13.3% of South Atlantic Bancshares shares are owned by institutional investors. 6.2% of Home Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Home Bancorp and South Atlantic Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Home Bancorp	22.01%	11.03%	1.32%
South Atlantic Bancshares	N/A	N/A	N/A

Volatility and Risk

Home Bancorp has a beta of 0.53, indicating that its share price is 47% less volatile than the S&P 500. Comparatively, South Atlantic Bancshares has a beta of 0.08, indicating that its share price is 92% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Home Bancorp and South Atlantic Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Home Bancorp	0	2	3	0	2.60
South Atlantic Bancshares	0	1	0	0	2.00

Home Bancorp presently has a consensus target price of $63.00, suggesting a potential downside of 2.60%. Given Home Bancorp’s stronger consensus rating and higher probable upside, equities analysts plainly believe Home Bancorp is more favorable than South Atlantic Bancshares.

Summary

Home Bancorp beats South Atlantic Bancshares on 16 of the 17 factors compared between the two stocks.

About Home Bancorp

Home Bancorp, Inc. operates as the bank holding company for Home Bank, National Association that provides various banking products and services in Louisiana, Mississippi, and Texas. It offers deposit products, including interest-bearing and noninterest-bearing checking, money market, savings, NOW, and certificates of deposit accounts. The company also provides various loan products comprising one-to four-family first mortgage loans, home equity loans and lines, commercial real estate loans, construction and land loans, multi-family residential loans, commercial and industrial loans, and consumer loans. In addition, it invests in securities; and offers credit cards and online banking services. Home Bancorp, Inc. was founded in 1908 and is headquartered in Lafayette, Louisiana.

About South Atlantic Bancshares

South Atlantic Bancshares, Inc. operates as the bank holding company for South Atlantic Bank that provides consumer and commercial banking products and services to individuals, small businesses, and corporations in South Carolina. The company offers checking, money market, and saving accounts, as well as certificate of deposit, individual retirement, and health saving accounts; personal, auto, and recreation loans, as well as home equity and ready reserve overdraft line of credits, and commercial lending products; and credit cards. It also provides cash management and merchant card services; remote deposit capture and automated clearing house services; online, mobile, and telephone banking services; personal and business checks; mortgage products and services; and wealth management services. The company operates offices in Myrtle Beach, Carolina Forest, North Myrtle Beach, Murrells Inlet, Pawleys Island, Georgetown, Mount Pleasant, Charleston, Bluffton, Hilton Head Island, and Beaufort, South Carolina. South Atlantic Bancshares, Inc. was founded in 2007 and is headquartered in Myrtle Beach, South Carolina.