Community Trust Bancorp (NASDAQ:CTBI) & Byline Bancorp (NYSE:BY) Critical Comparison

Community Trust Bancorp (NASDAQ:CTBI) and Byline Bancorp (NYSE:BY) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, profitability, dividends, analyst recommendations, valuation and institutional ownership.

Profitability

This table compares Community Trust Bancorp and Byline Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Community Trust Bancorp	25.48%	12.60%	1.62%
Byline Bancorp	24.06%	12.04%	1.57%

Insider & Institutional Ownership

60.2% of Community Trust Bancorp shares are held by institutional investors. Comparatively, 67.7% of Byline Bancorp shares are held by institutional investors. 2.6% of Community Trust Bancorp shares are held by insiders. Comparatively, 29.1% of Byline Bancorp shares are held by 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.

Dividends

Community Trust Bancorp pays an annual dividend of $2.60 per share and has a dividend yield of 3.7%. Byline Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 1.5%. Community Trust Bancorp pays out 42.8% of its earnings in the form of a dividend. Byline Bancorp pays out 16.3% 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. Community Trust Bancorp has increased its dividend for 44 consecutive years and Byline Bancorp has increased its dividend for 1 consecutive years. Community Trust Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Community Trust Bancorp has a beta of 0.56, suggesting that its stock price is 44% less volatile than the S&P 500. Comparatively, Byline Bancorp has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Community Trust Bancorp and Byline Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Community Trust Bancorp	0	2	1	1	2.75
Byline Bancorp	0	3	3	1	2.71

Community Trust Bancorp presently has a consensus target price of $78.50, indicating a potential upside of 13.13%. Byline Bancorp has a consensus target price of $43.50, indicating a potential upside of 12.94%. Given Community Trust Bancorp’s stronger consensus rating and higher possible upside, research analysts clearly believe Community Trust Bancorp is more favorable than Byline Bancorp.

Valuation and Earnings

This table compares Community Trust Bancorp and Byline Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Community Trust Bancorp	$307.11 million	4.10	$98.06 million	$6.08	11.41
Byline Bancorp	$633.15 million	2.75	$130.05 million	$3.43	11.23

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

Summary

Community Trust Bancorp beats Byline Bancorp on 10 of the 17 factors compared between the two stocks.

About Community Trust Bancorp

Community Trust Bancorp, Inc. operates as the bank holding company for Community Trust Bank, Inc. that engages in the provision of commercial and personal banking, and trust and wealth management services to small and mid-sized communities in eastern, northeastern, central, and south-central Kentucky, as well as southern West Virginia, and northeastern Tennessee. The company accepts time and demand deposits, checking accounts, savings accounts and savings certificates, individual retirement accounts and Keogh plans, and money market accounts. Its loan portfolio includes commercial, construction, mortgage, and personal loans; lease-financing, lines of credit, revolving lines of credit, and term loans, as well as other specialized loans, including asset-based financing; residential and commercial real estate loans; and consumer loans. The company also provides cash management, renting safe deposit boxes, and funds transfer services; issues letters of credit; and acts as a trustee of personal trusts, executor of estates, trustee for employee benefit trusts, and paying agent for bond and stock issues, as well as an investment agent and depositor for securities. In addition, it offers securities brokerage services; debit cards; annuity and life insurance products; and repurchase agreements, as well as mobile, internet banking, and e-statement services. The company was founded in 1903 and is headquartered in Pikeville, Kentucky.

About Byline Bancorp

Byline Bancorp, Inc. operates as the bank holding company for Byline Bank that provides various banking products and services for small and medium sized businesses, commercial real estate and financial sponsors, and consumers in the United States. It offers various retail deposit products, including non-interest-bearing accounts, money market demand accounts, savings accounts, interest-bearing checking accounts, and time deposits; ATM and debit cards; and online, mobile, and text banking services, as well as commercial deposits. The company also provides term loans, revolving lines of credit, and construction financing services; senior secured financing solutions to private equity backed lower middle market companies; small business administration and united states department of agriculture loans; and treasury management products and services. In addition, it offers financing solutions for equipment vendors and their end users; syndication services; and investment, trust, and wealth management services that include fiduciary and executor services, financial planning solutions, investment advisory services, and private banking services for foundations and endowments, and high net worth individuals. The company was formerly known as Metropolitan Bank Group, Inc. and changed its name to Byline Bancorp, Inc. in 2015. Byline Bancorp, Inc. was founded in 1914 and is headquartered in Chicago, Illinois.