First Financial Bankshares (NASDAQ:FFIN) and Northpointe Bancshares (NYSE:NPB) Head to Head Review

First Financial Bankshares (NASDAQ:FFIN) and Northpointe Bancshares (NYSE:NPB) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, valuation, analyst recommendations, risk, earnings, dividends and institutional ownership.

Dividends

First Financial Bankshares pays an annual dividend of $0.88 per share and has a dividend yield of 2.9%. Northpointe Bancshares pays an annual dividend of $0.12 per share and has a dividend yield of 0.8%. First Financial Bankshares pays out 47.1% of its earnings in the form of a dividend. Northpointe Bancshares pays out 5.2% 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. First Financial Bankshares has raised its dividend for 15 consecutive years. First Financial Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

First Financial Bankshares has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500. Comparatively, Northpointe Bancshares has a beta of 0.16, indicating that its share price is 84% less volatile than the S&P 500.

Insider and Institutional Ownership

69.8% of First Financial Bankshares shares are held by institutional investors. 3.8% of First Financial Bankshares shares are held by company insiders. Comparatively, 18.3% of Northpointe Bancshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for First Financial Bankshares and Northpointe Bancshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Financial Bankshares	0	6	0	1	2.29
Northpointe Bancshares	1	2	2	0	2.20

First Financial Bankshares currently has a consensus target price of $35.40, suggesting a potential upside of 16.18%. Northpointe Bancshares has a consensus target price of $20.42, suggesting a potential upside of 31.42%. Given Northpointe Bancshares’ higher probable upside, analysts plainly believe Northpointe Bancshares is more favorable than First Financial Bankshares.

Profitability

This table compares First Financial Bankshares and Northpointe Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Financial Bankshares	33.16%	14.91%	1.89%
Northpointe Bancshares	17.72%	14.99%	1.25%

Valuation and Earnings

This table compares First Financial Bankshares and Northpointe Bancshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Financial Bankshares	$833.20 million	5.24	$253.58 million	$1.87	16.29
Northpointe Bancshares	$471.18 million	1.14	$83.41 million	$2.31	6.73

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

Summary

First Financial Bankshares beats Northpointe Bancshares on 12 of the 18 factors compared between the two stocks.

About First Financial Bankshares

First Financial Bankshares, Inc., through its subsidiaries, provides commercial banking products and services in Texas. The company offers checking, savings and time deposits; automated teller machines, drive-in, and night deposit services; safe deposit facilities, remote deposit capture, internet banking, mobile banking, payroll cards, funds transfer, and performing other customary commercial banking services; securities brokerage services; and trust and wealth management services, including wealth management, estates administration, oil and gas management, testamentary trusts, revocable and irrevocable trusts, and agency accounts. It also provides commercial and industrial, municipal, agricultural, construction and development, farm, residential, and consumer auto and non-auto, as well as non-owner occupied and owner occupied commercial real estate loans. In addition, the company offers advisory and specialized services related to asset management, investing, purchasing, advertising, public relations, and technology services. First Financial Bankshares, Inc. was founded in 1890 and is headquartered in Abilene, Texas.

About Northpointe Bancshares

Northpointe Bancshares, Inc. operates as a bank holding company. It offers a nationwide mortgage purchase program, residential mortgage loans, digital deposit banking to retail customers and custodial deposit services. The company was founded by Charles A. Williams in 1998 and is headquartered in Grand Rapids, MI.