Financial Comparison: BankUnited (BKU) & First Bank (FRBA)

BankUnited (NYSE: BKU) and First Bank (NASDAQ:FRBA) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, valuation, dividends, risk, analyst recommendations and earnings.

Analyst Recommendations

This is a summary of current ratings and recommmendations for BankUnited and First Bank, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BankUnited 0 3 7 0 2.70
First Bank 0 0 1 0 3.00

BankUnited presently has a consensus target price of $40.82, suggesting a potential upside of 24.37%. First Bank has a consensus target price of $14.00, suggesting a potential upside of 13.36%. Given BankUnited’s higher possible upside, analysts clearly believe BankUnited is more favorable than First Bank.

Profitability

This table compares BankUnited and First Bank’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BankUnited 19.54% 9.81% 0.87%
First Bank 17.19% N/A N/A

Institutional & Insider Ownership

98.6% of BankUnited shares are held by institutional investors. Comparatively, 43.3% of First Bank shares are held by institutional investors. 5.1% of BankUnited shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

BankUnited pays an annual dividend of $0.84 per share and has a dividend yield of 2.6%. First Bank pays an annual dividend of $0.08 per share and has a dividend yield of 0.6%. BankUnited pays out 37.7% of its earnings in the form of a dividend. First Bank pays out 12.5% 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.

Earnings & Valuation

This table compares BankUnited and First Bank’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
BankUnited $973.23 million 3.60 $238.16 million $2.23 14.72
First Bank $31.35 million 5.92 $9.61 million $0.64 19.30

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

Volatility & Risk

BankUnited has a beta of 1.07, indicating that its stock price is 7% more volatile than the S&P 500. Comparatively, First Bank has a beta of 0.57, indicating that its stock price is 43% less volatile than the S&P 500.

Summary

BankUnited beats First Bank on 12 of the 16 factors compared between the two stocks.

About BankUnited

BankUnited, Inc. is the bank holding company of BankUnited (the Bank). The bank is a national banking association. As of December 31, 2016, the Bank provided a range of banking services to individual and corporate customers through 94 banking centers located in 15 Florida counties and six banking centers in the New York metropolitan area. The Bank also provides a range of traditional banking products and services to both its commercial and retail customers. The Company offers a range of lending products, including small business loans, commercial real estate loans, equipment loans and leases, term loans, formula-based loans, municipal and non-profit loans and leases, commercial and mortgage warehouse lines of credit, letters of credit and consumer loans. It offers traditional deposit products, including checking accounts, money market deposit accounts, savings accounts and certificates of deposit with a range of terms and rates.

About First Bank

First Bank is a commercial bank. The Company provides a range of lending, deposit and other financial products and services. It operates through Community Banking segment, which is engaged in providing a range of commercial and retail and related banking services. It offers a range of lending products to meet the needs of its customers located within its market areas, including commercial and industrial loans, commercial real estate loans (including owner-occupied, investor, construction and development and multi-family loans), residential real estate loans, and consumer and other loans. It offers a range of deposit instruments, including non-interest bearing demand deposits (such as checking accounts), interest bearing demand accounts, money market accounts, savings accounts and certificates of deposit. It operates over 10 branches located in Cranbury, Denville, Ewing, Flemington, Hamilton, Lawrence, Somerset, Randolph and Williamstown, New Jersey, and Trevose, Pennsylvania.

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