Reviewing FB Financial (FBK) & Cambridge Bancorp (CATC)

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FB Financial (NYSE:FBK) and Cambridge Bancorp (NASDAQ:CATC) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, earnings, dividends, institutional ownership, profitability and analyst recommendations.

Dividends

FB Financial pays an annual dividend of $0.32 per share and has a dividend yield of 0.9%. Cambridge Bancorp pays an annual dividend of $2.04 per share and has a dividend yield of 2.6%. FB Financial pays out 12.3% of its earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of current ratings for FB Financial and Cambridge Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
FB Financial 0 2 2 0 2.50
Cambridge Bancorp 0 0 0 0 N/A

FB Financial currently has a consensus price target of $42.50, suggesting a potential upside of 25.74%. Given FB Financial’s higher probable upside, equities analysts plainly believe FB Financial is more favorable than Cambridge Bancorp.

Earnings & Valuation

This table compares FB Financial and Cambridge Bancorp’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
FB Financial $370.16 million 2.80 $80.24 million $2.61 12.95
Cambridge Bancorp $102.04 million 3.19 $23.88 million N/A N/A

FB Financial has higher revenue and earnings than Cambridge Bancorp.

Insider and Institutional Ownership

53.4% of FB Financial shares are owned by institutional investors. Comparatively, 37.4% of Cambridge Bancorp shares are owned by institutional investors. 57.3% of FB Financial shares are owned by insiders. Comparatively, 3.3% of Cambridge Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

FB Financial has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500. Comparatively, Cambridge Bancorp has a beta of 0.08, suggesting that its stock price is 92% less volatile than the S&P 500.

Profitability

This table compares FB Financial and Cambridge Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
FB Financial 21.68% 13.02% 1.67%
Cambridge Bancorp 23.40% 15.42% 1.22%

Summary

FB Financial beats Cambridge Bancorp on 8 of the 14 factors compared between the two stocks.

About FB Financial

FB Financial Corporation operates as a holding company for FirstBank that provides a suite of commercial and consumer banking services to businesses, professionals, and individuals. The company operates in two segments, Banking and Mortgage. It provides demand, negotiable order of withdrawal, money market, certificates of deposit, and municipal and savings accounts, as well as time deposits. The company also offers commercial lending products that include working capital lines of credit, equipment loans, owner-occupied and non-owner-occupied real estate construction loans, real estate term loans, and cash flow loans to small and medium sized businesses; and consumer lending products comprising first and second residential mortgage loans, and home equity lines of credit, as well as consumer installment loans to purchase cars, boats, and other recreational vehicles. In addition, it provides residential mortgage banking services through its bank branch network and mortgage banking offices located in the southeastern United States; and an Internet delivery channel, as well as third-party mortgage services to smaller community banks and mortgage companies. Further, the company offers investment services, including equities, mutual funds, bonds, tax-exempt municipals, and annuities; and money management consultation and life insurance products, as well as retirement plan advisory services to business clients. As of January 22, 2018, it operated 58 full-service bank branches across Tennessee, North Alabama, and North Georgia. The company was formerly known as First South Bancorp, Inc. and changed its name to FB Financial Corporation in March 2016. FB Financial Corporation was founded in 1906 and is headquartered in Nashville, Tennessee.

About Cambridge Bancorp

Cambridge Bancorp operates as the bank holding company for Cambridge Trust Company that provides commercial and consumer banking, and investment management and trust services. The company accepts various deposits, such as checking and savings accounts, certificates of deposit, money market accounts, individual retirement accounts, and time and demand deposits. Its loans products include residential and commercial real estate loans; home equity lines of credit and term loans; commercial and industrial loans; secured and unsecured loans, lines of credit, and personal installment loans; and construction loans. The company also offers cash management, online and mobile banking, and payments services. It serves commercial enterprises, non-profit organizations, and individuals. The company operates 10 Massachusetts locations in Cambridge, Boston, Belmont, Concord, Lexington, and Weston; and wealth management offices in Boston, Massachusetts, as well as in Concord, Manchester, and Portsmouth, New Hampshire. Cambridge Bancorp was founded in 1890 and is headquartered in Cambridge, Massachusetts.

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