Head-To-Head Analysis: Isabella Bank (OTCMKTS:ISBA) & Renasant (NASDAQ:RNST)

Isabella Bank (OTCMKTS:ISBA) and Renasant (NASDAQ:RNST) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, dividends, risk, institutional ownership, earnings, analyst recommendations and profitability.

Profitability

This table compares Isabella Bank and Renasant’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Isabella Bank	13.28%	7.34%	0.73%
Renasant	17.91%	6.58%	0.93%

Insider and Institutional Ownership

77.3% of Renasant shares are held by institutional investors. 9.7% of Isabella Bank shares are held by insiders. Comparatively, 2.8% of Renasant shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Isabella Bank pays an annual dividend of $1.12 per share and has a dividend yield of 3.1%. Renasant pays an annual dividend of $0.88 per share and has a dividend yield of 2.4%. Isabella Bank pays out 51.1% of its earnings in the form of a dividend. Renasant pays out 34.6% 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.

Analyst Ratings

This is a summary of recent ratings for Isabella Bank and Renasant, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Isabella Bank	0	1	0	0	2.00
Renasant	0	1	5	1	3.00

Isabella Bank currently has a consensus price target of $34.00, indicating a potential downside of 4.87%. Renasant has a consensus price target of $43.00, indicating a potential upside of 15.37%. Given Renasant’s stronger consensus rating and higher probable upside, analysts plainly believe Renasant is more favorable than Isabella Bank.

Valuation and Earnings

This table compares Isabella Bank and Renasant”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Isabella Bank	$70.49 million	3.73	$13.89 million	$2.19	16.32
Renasant	$771.83 million	4.59	$195.46 million	$2.54	14.67

Renasant has higher revenue and earnings than Isabella Bank. Renasant is trading at a lower price-to-earnings ratio than Isabella Bank, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Isabella Bank has a beta of 0.12, suggesting that its stock price is 88% less volatile than the S&P 500. Comparatively, Renasant has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.

Summary

Renasant beats Isabella Bank on 13 of the 17 factors compared between the two stocks.

About Isabella Bank

Isabella Bank Corporation operates as the bank holding company for Isabella Bank that provides various banking products and services to businesses, institutions, and individuals and their families. Its deposit products include checking accounts, savings accounts, certificates of deposit, direct deposits, and money market accounts. The company's loan portfolio comprises commercial, agricultural, and residential real estate loans, as well as consumer loans, including secured and unsecured personal loans. It also offers cash management, mobile and internet banking, electronic bill pay, automated teller machines, trust and investment, estate planning, and safe deposit box rental services; and insurance products. The company operated banking offices in Clare, Gratiot, Isabella, Mecosta, Midland, Montcalm, and Saginaw counties. Isabella Bank Corporation was founded in 1903 and is headquartered in Mount Pleasant, Michigan.

About Renasant

Renasant Corporation operates as a bank holding company for Renasant Bank that provides a range of financial, wealth management, fiduciary, and insurance services to retail and commercial customers. The company operates through Community Banks, Insurance, and Wealth Management segments. The Community Banks segment offers checking and savings accounts, business and personal loans, asset-based lending, and factoring equipment leasing services, as well as safe deposit and night depository facilities. It also provides commercial, financial, and agricultural loans; equipment financing and leasing; real estate1-4 family mortgage; real estatecommercial mortgage; real estateconstruction loans for the construction of single family residential properties, multi-family properties, and commercial projects; installment loans to individuals; and interim construction loans, as well as automated teller machine (ATM), online and mobile banking, call center, and treasury management services. The Insurance segment provides insurance agency services, such as commercial and personal insurance products through insurance carriers. The Wealth Management segment offers a range of wealth management and fiduciary services, including administration and management of trust accounts, such as personal and corporate benefit accounts, and custodial accounts, as well as accounting and money management for trust accounts; annuities, mutual funds, and other investment services through a third party broker-dealer; administrative and compliance services; and qualified retirement plans, IRAs, employee benefit plans, personal trusts, and estates. Renasant Corporation was founded in 1904 and is headquartered in Tupelo, Mississippi.