HBT Financial (NASDAQ:HBT) vs. First United (NASDAQ:FUNC) Critical Comparison

HBT Financial (NASDAQ:HBT) and First United (NASDAQ:FUNC) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Profitability

This table compares HBT Financial and First United’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HBT Financial	24.66%	14.26%	1.62%
First United	19.99%	13.55%	1.36%

Earnings and Valuation

This table compares HBT Financial and First United”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HBT Financial	$293.97 million	4.64	$77.01 million	$2.56	14.66
First United	$121.42 million	2.46	$24.51 million	$3.90	11.85

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

Analyst Ratings

This is a summary of current recommendations for HBT Financial and First United, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HBT Financial	0	2	3	2	3.00
First United	0	0	4	0	3.00

HBT Financial currently has a consensus target price of $39.20, suggesting a potential upside of 4.45%. First United has a consensus target price of $49.50, suggesting a potential upside of 7.07%. Given First United’s higher possible upside, analysts plainly believe First United is more favorable than HBT Financial.

Institutional & Insider Ownership

78.5% of HBT Financial shares are owned by institutional investors. Comparatively, 33.3% of First United shares are owned by institutional investors. 51.9% of HBT Financial shares are owned by insiders. Comparatively, 8.1% of First United shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

HBT Financial pays an annual dividend of $1.00 per share and has a dividend yield of 2.7%. First United pays an annual dividend of $1.12 per share and has a dividend yield of 2.4%. HBT Financial pays out 39.1% of its earnings in the form of a dividend. First United pays out 28.7% 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. HBT Financial has increased its dividend for 5 consecutive years and First United has increased its dividend for 6 consecutive years.

Volatility and Risk

HBT Financial has a beta of 0.43, meaning that its stock price is 57% less volatile than the S&P 500. Comparatively, First United has a beta of 0.52, meaning that its stock price is 48% less volatile than the S&P 500.

Summary

HBT Financial beats First United on 11 of the 17 factors compared between the two stocks.

About HBT Financial

HBT Financial, Inc. is a bank holding company headquartered in Bloomington, Illinois. Its principal subsidiary, Heartland Bank and Trust Company, provides commercial and consumer banking services to individuals, businesses and organizations. The bank offers deposit accounts, loans and other lending services, as well as trust, wealth management and related financial services. Its branch network serves communities across Illinois and eastern Iowa. HBT Financial became the parent company of Heartland Bank and Trust in 2019.

About First United

First United Corporation is a bank holding company headquartered in Oakland, Maryland. Through its principal subsidiary, First United Bank & Trust, the company provides community banking services to individuals, families, businesses and nonprofit organizations. First United Bank & Trust offers deposit accounts, consumer and commercial lending, mortgage services, online and mobile banking, cash-management solutions, and wealth-management services. Its lending activities include residential mortgages, home-equity loans, personal loans, commercial real estate financing and other business credit products.