KB Financial Group (NYSE:KB) versus First Bank (NASDAQ:FRBA) Critical Analysis

First Bank (NASDAQ:FRBA) and KB Financial Group (NYSE:KB) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, dividends, profitability and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations and price targets for First Bank and KB Financial Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Bank	0	1	3	1	3.00
KB Financial Group	0	0	2	1	3.33

First Bank presently has a consensus price target of $19.67, indicating a potential downside of 0.32%. Given First Bank’s higher probable upside, analysts plainly believe First Bank is more favorable than KB Financial Group.

Insider and Institutional Ownership

64.9% of First Bank shares are owned by institutional investors. Comparatively, 11.5% of KB Financial Group shares are owned by institutional investors. 13.1% of First Bank shares are owned by insiders. Comparatively, 69.0% of KB Financial Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

First Bank has a beta of 0.53, meaning that its stock price is 47% less volatile than the S&P 500. Comparatively, KB Financial Group has a beta of 1.09, meaning that its stock price is 9% more volatile than the S&P 500.

Dividends

First Bank pays an annual dividend of $0.48 per share and has a dividend yield of 2.4%. KB Financial Group pays an annual dividend of $2.70 per share and has a dividend yield of 2.4%. First Bank pays out 28.1% of its earnings in the form of a dividend. KB Financial Group pays out 23.2% 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
First Bank	17.73%	9.58%	1.07%
KB Financial Group	17.67%	10.11%	0.76%

Earnings & Valuation

This table compares First Bank and KB Financial Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Bank	$245.83 million	2.01	$43.66 million	$1.71	11.54
KB Financial Group	$23.41 billion	1.74	$4.04 billion	$11.65	9.85

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

About First Bank

First Bank is a community bank headquartered in Hamilton, New Jersey, serving individuals, businesses and organizations in New Jersey and eastern Pennsylvania. The bank began operations in 2007 and has expanded its branch network across the region. Its services include business and personal deposit accounts, commercial and consumer loans, and online and mobile banking. First Bank has a particular focus on commercial banking, including lending to businesses and financing commercial real estate.

About KB Financial Group

KB Financial Group Inc. is a South Korean financial holding company headquartered in Seoul. Established in 2008, it brings together businesses serving individual, corporate and institutional customers, with operations centered primarily in South Korea and an international presence through overseas offices and subsidiaries. Its businesses include commercial and retail banking through KB Kookmin Bank, as well as securities and investment banking, insurance, credit cards, asset management, and consumer and corporate finance.