Horizon Bancorp (NASDAQ:HBNC) versus MetroCity Bankshares (NASDAQ:MCBS) Financial Review

MetroCity Bankshares (NASDAQ:MCBS – Get Rating) and Horizon Bancorp (NASDAQ:HBNC – Get Rating) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, institutional ownership, risk, analyst recommendations and profitability.

Volatility & Risk

MetroCity Bankshares has a beta of 0.53, suggesting that its share price is 47% less volatile than the S&P 500. Comparatively, Horizon Bancorp has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for MetroCity Bankshares and Horizon Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MetroCity Bankshares	0	1	0	0	2.00
Horizon Bancorp	0	2	2	0	2.50

MetroCity Bankshares presently has a consensus price target of $19.00, suggesting a potential upside of 14.60%. Horizon Bancorp has a consensus price target of $16.50, suggesting a potential upside of 77.23%. Given Horizon Bancorp’s stronger consensus rating and higher probable upside, analysts clearly believe Horizon Bancorp is more favorable than MetroCity Bankshares.

Institutional & Insider Ownership

16.7% of MetroCity Bankshares shares are held by institutional investors. Comparatively, 56.1% of Horizon Bancorp shares are held by institutional investors. 27.3% of MetroCity Bankshares shares are held by insiders. Comparatively, 3.0% of Horizon Bancorp shares are held 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

MetroCity Bankshares pays an annual dividend of $0.72 per share and has a dividend yield of 4.3%. Horizon Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 6.9%. MetroCity Bankshares pays out 29.6% of its earnings in the form of a dividend. Horizon Bancorp pays out 31.7% 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. MetroCity Bankshares has increased its dividend for 3 consecutive years and Horizon Bancorp has increased its dividend for 12 consecutive years. Horizon Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares MetroCity Bankshares and Horizon Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MetroCity Bankshares	34.62%	18.01%	1.85%
Horizon Bancorp	29.11%	13.09%	1.13%

Earnings & Valuation

This table compares MetroCity Bankshares and Horizon Bancorp’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MetroCity Bankshares	$128.62 million	3.24	$62.60 million	$2.43	6.82
Horizon Bancorp	$283.48 million	1.45	$93.41 million	$2.02	4.61

Horizon Bancorp has higher revenue and earnings than MetroCity Bankshares. Horizon Bancorp is trading at a lower price-to-earnings ratio than MetroCity Bankshares, indicating that it is currently the more affordable of the two stocks.

Summary

Horizon Bancorp beats MetroCity Bankshares on 9 of the 17 factors compared between the two stocks.

About MetroCity Bankshares

(Get Rating)

MetroCity Bankshares, Inc. is a bank holding company, which engages in the provision of commercial bank services. The firm offers customary banking services as consumer and commercial checking accounts, savings accounts, certificates of deposit, commercial and consumer loans, single family residential loans, and money transfers services. Its portfolio includes construction and development, commercial real estate, commercial and industrial, single family residential mortgages, and consumer and other. The company was founded in 2014 and is headquartered in Doraville, GA.

About Horizon Bancorp

(Get Rating)

Horizon Bancorp, Inc. (Indiana) is a bank holding company, which engages in the provision of commercial and retail banking services. It offers personal banking, business banking, investment and trust, and mortgage services. The company was founded in 1873 and is headquartered in Michigan City, IN.