Comparing HomeTrust Bancshares (NYSE:HTB) and Regions Financial (NYSE:RF)

HomeTrust Bancshares (NYSE:HTB) and Regions Financial (NYSE:RF) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, risk, analyst recommendations and valuation.

Profitability

This table compares HomeTrust Bancshares and Regions Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HomeTrust Bancshares	22.50%	10.88%	1.45%
Regions Financial	23.33%	12.88%	1.42%

Analyst Recommendations

This is a summary of current ratings and target prices for HomeTrust Bancshares and Regions Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HomeTrust Bancshares	0	2	2	1	2.80
Regions Financial	4	10	6	0	2.10

HomeTrust Bancshares currently has a consensus target price of $52.00, suggesting a potential upside of 7.05%. Regions Financial has a consensus target price of $32.29, suggesting a potential upside of 7.74%. Given Regions Financial’s higher probable upside, analysts clearly believe Regions Financial is more favorable than HomeTrust Bancshares.

Earnings and Valuation

This table compares HomeTrust Bancshares and Regions Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HomeTrust Bancshares	$292.47 million	2.77	$64.36 million	$3.81	12.75
Regions Financial	$9.61 billion	2.66	$2.16 billion	$2.45	12.23

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

Dividends

HomeTrust Bancshares pays an annual dividend of $0.60 per share and has a dividend yield of 1.2%. Regions Financial pays an annual dividend of $1.20 per share and has a dividend yield of 4.0%. HomeTrust Bancshares pays out 15.7% of its earnings in the form of a dividend. Regions Financial pays out 49.0% 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. Regions Financial has increased its dividend for 12 consecutive years. Regions Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

60.9% of HomeTrust Bancshares shares are held by institutional investors. Comparatively, 79.4% of Regions Financial shares are held by institutional investors. 11.0% of HomeTrust Bancshares shares are held by company insiders. Comparatively, 0.3% of Regions Financial shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

HomeTrust Bancshares has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Regions Financial has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500.

Summary

Regions Financial beats HomeTrust Bancshares on 10 of the 18 factors compared between the two stocks.

About HomeTrust Bancshares

HomeTrust Bancshares, Inc. operates as the bank holding company for HomeTrust Bank that provides a range of retail and commercial banking products and services. Its deposit products include savings, money market, and demand accounts, as well as certificates of deposit for individuals, businesses, and nonprofit organizations. The company’s loan portfolio comprises retail consumer loans, such as one-to-four-family real estate lending, home equity lines of credit, construction and land/lots, indirect auto finance, and consumer lending; and commercial loans that include commercial real estate, construction and development, and commercial and industrial loans. It also provides small business administration loans, equipment finance leases, indirect automobile loans, and municipal leases; and cash management and online/mobile banking services. As of June 30, 2021, the company operated 41 offices in North Carolina, Upstate South Carolina, East Tennessee, and Southwest Virginia. HomeTrust Bancshares, Inc. was founded in 1926 and is headquartered in Asheville, North Carolina.

About Regions Financial

Regions Financial Corporation, a financial holding company, provides banking and bank-related services to individual and corporate customers. It operates through three segments: Corporate Bank, Consumer Bank, and Wealth Management. The Corporate Bank segment offers commercial banking services, such as commercial and industrial, commercial real estate, and investor real estate lending; equipment lease financing; deposit products; and securities underwriting and placement, loan syndication and placement, foreign exchange, derivatives, merger and acquisition, and other advisory services. It serves corporate, middle market, and commercial real estate developers and investors. The Consumer Bank segment provides consumer banking products and services related to residential first mortgages, home equity lines and loans, consumer credit cards, and other consumer loans, as well as deposits. The Wealth Management segment offers credit related products, and retirement and savings solutions; and trust and investment management, asset management, and estate planning services to individuals, businesses, governmental institutions, and non-profit entities. It also provides investment and insurance products; low-income housing tax credit corporate fund syndication services; and other specialty financing services. The company was founded in 1971 and is headquartered in Birmingham, Alabama.