United Community Banks (NASDAQ: UCBI – Get a rating) and Veritex (NASDAQ:VBTX – Get a rating) are both finance companies, but which stock is superior? We will compare the two companies based on institutional ownership strength, risk, valuation, dividends, analyst recommendations, profitability and earnings.
Institutional and Insider Ownership
79.5% of United Community Banks shares are held by institutional investors. Comparatively, 77.5% of Veritex shares are held by institutional investors. 0.5% of the shares of United Community Banks are held by insiders of the company. By comparison, 3.4% of Veritex shares are held by company insiders. Strong institutional ownership indicates that large fund managers, endowments, and hedge funds believe a stock is poised for long-term growth.
United Community Banks pays an annual dividend of $0.84 per share and has a dividend yield of 2.6%. Veritex pays an annual dividend of $0.80 per share and has a dividend yield of 2.3%. United Community Banks pays 32.6% of its profits as a dividend. Veritex pays 28.7% of its earnings as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings over the next few years. United Community Banks has increased its dividend for 2 consecutive years and Veritex has increased its dividend for 2 consecutive years.
Benefits and evaluation
This table compares the revenue, earnings per share and valuation of United Community Banks and Veritex.
|Gross revenue||Price/sales ratio||Net revenue||Earnings per share||Price/earnings ratio|
|United Community Banks||$736.61 million||4.62||$269.80 million||$2.58||12:44 p.m.|
|Veritex||$374.89 million||5.01||$139.58 million||$2.79||12:48|
United Community Banks has higher revenues and profits than Veritex. United Community Banks trades at a lower price-to-earnings ratio than Veritex, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
United Community Banks has a beta of 1.07, suggesting its stock price is 7% more volatile than the S&P 500. Comparatively, Veritex has a beta of 1.49, suggesting its stock price is 49% more volatile than the S&P 500.
This is a summary of recent ratings and price targets for United Community Banks and Veritex, as provided by MarketBeat.
|Sales Ratings||Hold odds||Buy reviews||Strong buy odds||Rating|
|United Community Banks||0||1||0||0||2.00|
United Community Banks currently has a consensus target price of $42.00, suggesting a potential upside of 30.84%. Veritex has a consensus target price of $46.33, suggesting a potential upside of 33.07%. Given Veritex’s stronger consensus rating and higher possible upside, analysts clearly think Veritex is more favorable than United Community Banks.
This chart compares the net margins, return on equity, and return on assets of United Community Banks and Veritex.
|Net margins||Return on equity||return on assets|
|United Community Banks||32.10%||11.93%||1.25%|
Veritex beats United Community Banks on 12 of 17 factors compared between the two stocks.
About United Community Banks (Get a rating)
United Community Banks, Inc. operates as the financial holding company for United Community Bank which provides financial products and services to the commercial, retail, government, education, energy, healthcare, health and real estate. The Company accepts various deposit products including checking, savings, money market and other deposit accounts. It also offers lending services, including home, consumer and commercial loans, to individuals, small businesses, mid-sized commercial enterprises and non-profit organizations, as well as secured and unsecured loans and mortgage loans. In addition, the company issues loans partially secured by the SBA and USDA loan programs. Additionally, it provides wealth management services including financial planning, personalized portfolio management and investment advice; fiduciary services for managing fiduciary assets; investment products other than deposits; and insurance products, including life insurance, long-term care insurance and tax-deferred annuities, as well as investments in residential and commercial mortgage-backed securities, assets, US Treasury, US agency and municipal bonds. In addition, the company offers reinsurance on a property insurance contract; insurance agency services; brokerage services; and payment processing, merchant, wire transfer, private banking and other related financial services. It operates through a network of 171 branches in Florida, Georgia, North Carolina, South Carolina and Tennessee. United Community Banks, Inc. was founded in 1950 and is headquartered in Blairsville, Georgia.
About Veritex (Get a rating)
Veritex Holdings, Inc. operates as a bank holding company for Veritex Community Bank which provides various commercial banking products and services to small and medium businesses and professionals. The Company accepts deposit products including current, savings, money market and term accounts. Its lending products include Commercial and General Commercial Real Estate, Warehouse Mortgages, Residential Real Estate, Construction and Land, Farmland, Consumer, Paycheck Protection Program, Residential Lending for 1 to 4 families, agricultural, multi-family residential and consumer, as well as in the form of purchased receivables financing. The company also provides interest rate swap services; and a range of online banking solutions, such as access to account balances, online transfers, online bill payment and electronic delivery of customer statements, and ATMs, as well as banking services mobiles, mail and personal appointments. Additionally, it offers debit cards, overnight deposit services, direct deposits, cashiers checks, and letters of credit; cash management services, including balance reporting, inter-account transfers, wire transfer initiation, automated clearinghouse issuance and chargebacks; and cash management deposit products and services including safe, remote deposit capture, positive payment, reverse positive payment, account reconciliation services, zero balance accounts and transfer accounts . As of December 31, 2021, the company operated 18 full-service branches located in the Dallas-Fort Worth metroplex and 10 full-service branches in the Houston metro area. Veritex Holdings, Inc. was incorporated in 2009 and is headquartered in Dallas, Texas.
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