Comparing Benchmark Bankshares (OTCMKTS:BMBN) and South Plains Financial (NASDAQ:SPFI)

South Plains Financial (NASDAQ:SPFI) and Benchmark Bankshares (OTCMKTS:BMBN) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, earnings, analyst recommendations, risk, profitability and valuation.

Risk and Volatility

South Plains Financial has a beta of 0.46, meaning that its stock price is 54% less volatile than the S&P 500. Comparatively, Benchmark Bankshares has a beta of 0.12, meaning that its stock price is 88% less volatile than the S&P 500.

Institutional & Insider Ownership

54.9% of South Plains Financial shares are owned by institutional investors. Comparatively, 3.2% of Benchmark Bankshares shares are owned by institutional investors. 24.3% of South Plains Financial shares are owned by insiders. Comparatively, 14.0% of Benchmark Bankshares 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.

Dividends

South Plains Financial pays an annual dividend of $0.68 per share and has a dividend yield of 1.6%. Benchmark Bankshares pays an annual dividend of $1.00 per share and has a dividend yield of 2.3%. South Plains Financial pays out 19.0% of its earnings in the form of a dividend. Benchmark Bankshares pays out 22.4% 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. South Plains Financial has increased its dividend for 5 consecutive years.

Earnings and Valuation

This table compares South Plains Financial and Benchmark Bankshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
South Plains Financial	$296.89 million	2.76	$58.47 million	$3.57	11.98
Benchmark Bankshares	$83.37 million	2.29	$19.84 million	$4.46	9.64

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

Analyst Ratings

This is a breakdown of current ratings and target prices for South Plains Financial and Benchmark Bankshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
South Plains Financial	0	1	5	1	3.00
Benchmark Bankshares	0	0	0	0	0.00

South Plains Financial presently has a consensus price target of $47.60, suggesting a potential upside of 11.33%. Given South Plains Financial’s stronger consensus rating and higher possible upside, equities research analysts clearly believe South Plains Financial is more favorable than Benchmark Bankshares.

Profitability

This table compares South Plains Financial and Benchmark Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
South Plains Financial	20.22%	12.58%	1.35%
Benchmark Bankshares	23.80%	N/A	N/A

Summary

South Plains Financial beats Benchmark Bankshares on 15 of the 18 factors compared between the two stocks.

About South Plains Financial

South Plains Financial, Inc. operates as a bank holding company for City Bank that provides commercial and consumer financial services to small and medium-sized businesses and individuals. The company operates through two segments, Banking and Insurance. It offers deposit products, including demand deposit accounts, interest-bearing products, savings accounts, and certificate of deposits. The company also provides commercial real estate loans; general and specialized commercial loans, including agricultural production and real estate, energy, finance, investment, and insurance loans, as well as loans to goods, services, restaurant and retail, construction, and other industries; residential construction loans; and 1-4 family residential loans, auto loans, and other loans for recreational vehicles or other purposes. In addition, it offers crop insurance products; trust products and services; investment services; mortgage banking services; online and mobile banking services; and debit and credit cards. The company was founded in 1941 and is headquartered in Lubbock, Texas.

About Benchmark Bankshares

Benchmark Bankshares, Inc. operates as the holding company for Benchmark Community Bank that provides various banking products and services in the United States. The company accepts various deposits, such as checking, saving, commercial services, and youth accounts. Its loan products include personal, mortgage, other real estate, business, auto, and student loans. The company also offers credit and debit cards; wealth management services comprising financial solutions, financial and retirement planning, and portfolio management, as well as estate, charitable giving, and trust services; and reorder checks, safe deposit boxes, wire transfers, bill pay, and internet and mobile banking services. The company was founded in 1971 and is based in Kenbridge, Virginia.