Analyzing Community Trust Bancorp (NASDAQ:CTBI) and Truxton (OTCMKTS:TRUX)

Truxton (OTCMKTS:TRUX) and Community Trust Bancorp (NASDAQ:CTBI) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, valuation and dividends.

Profitability

This table compares Truxton and Community Trust Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Truxton	25.01%	N/A	N/A
Community Trust Bancorp	25.55%	12.66%	1.61%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Truxton and Community Trust Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Truxton	0	0	0	0	0.00
Community Trust Bancorp	0	2	2	0	2.50

Community Trust Bancorp has a consensus price target of $81.50, suggesting a potential upside of 3.89%. Given Community Trust Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Community Trust Bancorp is more favorable than Truxton.

Insider & Institutional Ownership

0.3% of Truxton shares are owned by institutional investors. Comparatively, 60.2% of Community Trust Bancorp shares are owned by institutional investors. 2.6% of Community Trust Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Risk and Volatility

Truxton has a beta of 0.58, meaning that its share price is 42% less volatile than the S&P 500. Comparatively, Community Trust Bancorp has a beta of 0.54, meaning that its share price is 46% less volatile than the S&P 500.

Earnings & Valuation

This table compares Truxton and Community Trust Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Truxton	$92.29 million	3.13	$21.48 million	$8.04	12.44
Community Trust Bancorp	$409.34 million	3.48	$98.06 million	$5.97	13.14

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

Dividends

Truxton pays an annual dividend of $3.52 per share and has a dividend yield of 3.5%. Community Trust Bancorp pays an annual dividend of $2.12 per share and has a dividend yield of 2.7%. Truxton pays out 43.8% of its earnings in the form of a dividend. Community Trust Bancorp pays out 35.5% 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. Community Trust Bancorp has raised its dividend for 44 consecutive years.

Summary

Community Trust Bancorp beats Truxton on 14 of the 17 factors compared between the two stocks.

About Truxton

Truxton Corporation, through its subsidiaries, provides various banking, investment management, and trust administration services to individuals, businesses, and charitable institutions in the United States. The company offers deposit products, including demand, money market accounts, and certificates of deposit. It also provides lending products, such as residential and commercial real estate mortgages, commercial loans, construction and land development loans, commercial and industrial loans, operating lines of credit, and loans to individual. In addition, the company offers strategic and capital advisory services, business banking, and treasury management services; and insurance products. The company was formerly known as NBT Holdings Inc. and changed its name to Truxton Corporation in May 2013. Truxton Corporation was founded in 2004 and is based in Nashville, Tennessee.

About Community Trust Bancorp

Community Trust Bancorp, Inc. operates as the bank holding company for Community Trust Bank, Inc. that engages in the provision of commercial and personal banking, and trust and wealth management services to small and mid-sized communities in eastern, northeastern, central, and south-central Kentucky, as well as southern West Virginia, and northeastern Tennessee. The company accepts time and demand deposits, checking accounts, savings accounts and savings certificates, individual retirement accounts and Keogh plans, and money market accounts. Its loan portfolio includes commercial, construction, mortgage, and personal loans; lease-financing, lines of credit, revolving lines of credit, and term loans, as well as other specialized loans, including asset-based financing; residential and commercial real estate loans; and consumer loans. The company also provides cash management, renting safe deposit boxes, and funds transfer services; issues letters of credit; and acts as a trustee of personal trusts, executor of estates, trustee for employee benefit trusts, and paying agent for bond and stock issues, as well as an investment agent and depositor for securities. In addition, it offers securities brokerage services; debit cards; annuity and life insurance products; and repurchase agreements, as well as mobile, internet banking, and e-statement services. The company was founded in 1903 and is headquartered in Pikeville, Kentucky.