Reviewing Peapack-Gladstone Financial (NASDAQ:PGC) & HBT Financial (NASDAQ:HBT)

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

Risk & Volatility

HBT Financial has a beta of 0.53, meaning that its share price is 47% less volatile than the S&P 500. Comparatively, Peapack-Gladstone Financial has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500.

Dividends

HBT Financial pays an annual dividend of $0.92 per share and has a dividend yield of 3.3%. Peapack-Gladstone Financial pays an annual dividend of $0.20 per share and has a dividend yield of 0.5%. HBT Financial pays out 42.2% of its earnings in the form of a dividend. Peapack-Gladstone Financial pays out 8.1% 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 raised its dividend for 5 consecutive years. HBT Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

78.6% of HBT Financial shares are owned by institutional investors. Comparatively, 72.8% of Peapack-Gladstone Financial shares are owned by institutional investors. 51.9% of HBT Financial shares are owned by company insiders. Comparatively, 5.8% of Peapack-Gladstone Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings for HBT Financial and Peapack-Gladstone Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HBT Financial	0	2	3	2	3.00
Peapack-Gladstone Financial	0	2	2	0	2.50

HBT Financial currently has a consensus target price of $30.20, indicating a potential upside of 9.54%. Peapack-Gladstone Financial has a consensus target price of $40.50, indicating a potential downside of 2.64%. Given HBT Financial’s stronger consensus rating and higher possible upside, equities research analysts plainly believe HBT Financial is more favorable than Peapack-Gladstone Financial.

Valuation & Earnings

This table compares HBT Financial and Peapack-Gladstone Financial”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HBT Financial	$293.97 million	3.41	$77.01 million	$2.18	12.65
Peapack-Gladstone Financial	$444.61 million	1.64	$37.33 million	$2.48	16.77

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

Profitability

This table compares HBT Financial and Peapack-Gladstone Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HBT Financial	22.72%	13.87%	1.65%
Peapack-Gladstone Financial	9.60%	6.82%	0.59%

Summary

HBT Financial beats Peapack-Gladstone Financial on 13 of the 18 factors compared between the two stocks.

About HBT Financial

HBT Financial, Inc. operates as the bank holding company for Heartland Bank and Trust Company that provides business, commercial, and retail banking products and services to individuals, businesses, and municipal entities in Central and Northeastern Illinois, and Eastern Iowa. The company's deposits accounts consist of noninterest-bearing demand deposits, interest-bearing transaction accounts, money market accounts, savings accounts, certificates of deposits, health savings accounts, and individual retirement accounts. Its loan offering comprises owner and non-owner occupied commercial real estate; construction and land development and multi-family; commercial and industrial; agricultural and farmland; and one-to-four family residential loans, as well as municipal, consumer, and other loans. The company also offers wealth management services, including financial planning to consumers, trusts, and estates; trustee and custodial; investment management; corporate retirement plan consulting and administration; and retail brokerage services. In addition, it provides farmland management, and farmland sales and services; commercial checking accounts; and treasury management services, as well as originates and sells residential mortgage loans. Further, the company offers digital banking services, such as online and mobile banking, and digital payment services, as well as personal financial management tools. The company was formerly known as Heartland Bancorp, Inc. and changed its name to HBT Financial, Inc. in September 2019. HBT Financial, Inc. was founded in 1920 and is headquartered in Bloomington, Illinois.

About Peapack-Gladstone Financial

Peapack-Gladstone Financial Corporation operates as the bank holding company for Peapack-Gladstone Bank that provides private banking and wealth management services in the United States. The company operates in two segments, Banking and Peapack Private. It offers checking and savings accounts, money market and interest-bearing checking accounts, certificates of deposit, and individual retirement accounts. The company also provides working capital lines of credit, term loans for fixed asset acquisitions, commercial mortgages, multi-family mortgages, and other forms of asset-based financing services; and residential mortgages, home equity lines of credit, and other second mortgage loans. In addition, it offers corporate and industrial (C&I) and equipment finance, commercial real estate, multifamily, residential, and consumer lending activities; treasury management services; C&I advisory services; escrow management; deposit generation; investment management services; personal trust services, including services as executor, trustee, administrator, custodian, and guardian; and other financial planning, tax preparation, and advisory services. Further, the company provides telephone and Internet banking, merchant credit card, and customer support sales services. Its private banking clients include businesses, non-profits, and consumers; wealth management clients comprise individuals, families, foundations, endowments, trusts, and estates; and commercial loan clients include business owners, professionals, retailers, contractors, and real estate investors. The company operates its private banking locations in Bedminster, Morristown, Princeton, and Teaneck, New Jersey; and branches in Somerset, Morris, Hunterdon, and Union counties, as well as operates automated teller machines. Peapack-Gladstone Financial Corporation was founded in 1921 and is headquartered in Bedminster, New Jersey.