Comparing Mechanics Bancorp (NASDAQ:MCHB) & First Community (NASDAQ:FCCO)

First Community (NASDAQ:FCCO) and Mechanics Bancorp (NASDAQ:MCHB) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their institutional ownership, earnings, profitability, analyst recommendations, dividends, valuation and risk.

Institutional and Insider Ownership

61.3% of First Community shares are owned by institutional investors. Comparatively, 74.7% of Mechanics Bancorp shares are owned by institutional investors. 8.8% of First Community shares are owned by company insiders. Comparatively, 81.6% of Mechanics Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings for First Community and Mechanics Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Community	0	1	2	0	2.67
Mechanics Bancorp	0	2	3	0	2.60

First Community presently has a consensus target price of $37.50, indicating a potential upside of 8.51%. Mechanics Bancorp has a consensus target price of $17.12, indicating a potential upside of 8.25%. Given First Community’s stronger consensus rating and higher possible upside, equities analysts plainly believe First Community is more favorable than Mechanics Bancorp.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
First Community	18.32%	13.23%	1.16%
Mechanics Bancorp	23.98%	10.70%	1.37%

Volatility and Risk

First Community has a beta of 0.33, meaning that its share price is 67% less volatile than the S&P 500. Comparatively, Mechanics Bancorp has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500.

Earnings and Valuation

This table compares First Community and Mechanics Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Community	$83.08 million	3.91	$19.20 million	$2.68	12.90
Mechanics Bancorp	$1.03 billion	3.39	$265.74 million	$1.23	12.86

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

Dividends

First Community pays an annual dividend of $0.68 per share and has a dividend yield of 2.0%. Mechanics Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 6.3%. First Community pays out 25.4% of its earnings in the form of a dividend. Mechanics Bancorp pays out 81.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. First Community has increased its dividend for 4 consecutive years.

Summary

Mechanics Bancorp beats First Community on 9 of the 17 factors compared between the two stocks.

About First Community

First Community Corporation operates as the bank holding company for First Community Bank that provides various commercial and retail banking products and services to small-to-medium sized businesses, professionals, and individuals. The company operates through Commercial and Retail Banking, Mortgage Banking, and Investment Advisory and Non-Deposit segments. Its deposit products include checking, NOW, savings, and individual retirement accounts; and demand deposits, as well as other time deposits, such as daily money market accounts and longer-term certificates of deposit. The company's loan portfolio comprises commercial loans that include secured and unsecured loans for working capital, business expansion, and the purchase of equipment and machinery; consumer loans, including secured and unsecured loans for financing automobiles, home improvements, education, and personal investments; real estate construction and acquisition loans; and fixed and variable rate mortgage loans. It also provides online banking, internet banking, cash management, safe deposit boxes, direct deposit of payroll and social security checks, and automatic drafts for various accounts. In addition, the company offers non-deposit investment products and other investment brokerage services; VISA and MasterCard credit card services; investment advisory services; and insurance services. The company was incorporated in 1994 and is headquartered in Lexington, South Carolina.

About Mechanics Bancorp

HomeStreet, Inc. operates as the bank holding company for HomeStreet Bank that provides commercial, mortgage, and consumer/retail banking services primarily in the Western United States. The company offers personal and business checking, savings accounts, interest-bearing negotiable order of withdrawal accounts, money market accounts, and time certificates of deposit; credit cards; insurance; and treasury management products and services. Its loan products include commercial business and agriculture loans, single family residential mortgages, consumer loans, commercial loans secured by residential and commercial real estate, and construction loans for residential and commercial real estate development, as well as consumer installment loans and permanent loans on commercial real estate and single-family residences. In addition, the company offers its products and services through bank branches, loan production offices, and ATMs, as well as through online, mobile, and telephone banking. As of December 31, 2021, it operated 60 full-service bank branches located in Washington state, Northern and Southern California, the Portland, Oregon, and Hawaii; and five primary stand-alone commercial lending centers in Central Washington, Oregon, Southern California, Idaho, and Utah. HomeStreet, Inc. serves small and medium sized businesses, real estate investors, professional firms, and individuals. The company was formerly known as Continental Mortgage and Loan Company. HomeStreet, Inc. was incorporated in 1921 and is headquartered in Seattle, Washington.