Comparing FB Financial (NYSE:FBK) and Shore Bancshares (NASDAQ:SHBI)

Shore Bancshares (NASDAQ:SHBI) and FB Financial (NYSE:FBK) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, earnings, valuation, profitability and dividends.

Profitability

This table compares Shore Bancshares and FB Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shore Bancshares	19.69%	12.34%	1.20%
FB Financial	22.62%	12.32%	1.44%

Institutional & Insider Ownership

59.8% of Shore Bancshares shares are held by institutional investors. Comparatively, 65.4% of FB Financial shares are held by institutional investors. 8.7% of Shore Bancshares shares are held by company insiders. Comparatively, 2.0% of FB Financial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Shore Bancshares and FB Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shore Bancshares	0	3	3	0	2.50
FB Financial	0	0	6	1	3.14

Shore Bancshares currently has a consensus target price of $25.62, indicating a potential upside of 12.94%. FB Financial has a consensus target price of $64.43, indicating a potential upside of 20.40%. Given FB Financial’s stronger consensus rating and higher possible upside, analysts clearly believe FB Financial is more favorable than Shore Bancshares.

Valuation & Earnings

This table compares Shore Bancshares and FB Financial”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shore Bancshares	$342.72 million	2.21	$59.51 million	$2.05	11.07
FB Financial	$701.34 million	3.81	$122.62 million	$4.50	11.89

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

Volatility and Risk

Shore Bancshares has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500. Comparatively, FB Financial has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500.

Dividends

Shore Bancshares pays an annual dividend of $0.56 per share and has a dividend yield of 2.5%. FB Financial pays an annual dividend of $0.84 per share and has a dividend yield of 1.6%. Shore Bancshares pays out 27.3% of its earnings in the form of a dividend. FB Financial pays out 18.7% 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. FB Financial has increased its dividend for 8 consecutive years.

Summary

FB Financial beats Shore Bancshares on 15 of the 18 factors compared between the two stocks.

About Shore Bancshares

Shore Bancshares, Inc. operates as a bank holding company for the Shore United Bank, N.A. that provides various commercial and consumer banking products and services to individuals, businesses, and other organizations. It offers checking, savings, overnight investment sweep, and money market accounts; and regular and IRA certificates of deposit, as well as CDARS programs and cash management services. The company also provides commercial loans, such as secured and unsecured loans, working capital loans, lines of credit, term loans, accounts receivable financing, real estate acquisition and development loans, construction loans, and letters of credit; residential real estate construction loans; residential mortgage loans; and loans to consumers, including home equity, automobile, installment, home improvement, and personal lines of credit, as well as other consumer financing products. In addition, it offers trust, asset management, and financial planning services; treasury management services, such as merchant card processing, remote deposit capture, and ACH origination, as well as telephone, mobile, and Internet banking services; safe deposit boxes; debit and credit cards; and automatic teller machine services. Shore Bancshares, Inc. was founded in 1876 and is headquartered in Easton, Maryland.

About FB Financial

FB Financial Corporation operates as a bank holding company for FirstBank that provides a suite of commercial and consumer banking services to businesses, professionals, and individuals. The company operates in segments, such as Banking and Mortgage. It offers checking, demand, money market, and savings accounts; deposit and lending products and services to corporate, commercial, and consumer customers; and time deposits and certificates of deposits, as well as residential mortgage loans. The company also provides owner-occupied and non-owner-occupied real estate commercial, residential real estate 1-4 family mortgage, multi-family residential, commercial and industrial, construction, land acquisition, residential lines of credit, and land development loans; and consumer and other loans, such as car, boat, and other recreational vehicle loans, as well as manufactured homes without real estate and personal lines of credit. In addition, the company offers mortgage banking services through its bank branch network and mortgage banking offices in the southeastern United States; direct-to-consumer internet delivery channel; and trust, insurance, and investment services, as well as online and mobile banking services. The company operates full-service bank branches and limited-service branches locations throughout Tennessee, Nashville, Chattanooga, Knoxville, Memphis, Jackson, Birmingham, Florence, Huntsville, Alabama, Bowling Green, and Kentucky; and mortgage offices throughout the southeastern United States. The company was formerly known as First South Bancorp, Inc. and changed its name to FB Financial Corporation in 2016. FB Financial Corporation was founded in 1906 and is headquartered in Nashville, Tennessee.