Contrasting First Citizens BancShares (NASDAQ:FCNCA) & 1st Source (NASDAQ:SRCE)

1st Source (NASDAQ:SRCE) and First Citizens BancShares (NASDAQ:FCNCA) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, analyst recommendations, institutional ownership, earnings and dividends.

Risk and Volatility

1st Source has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500. Comparatively, First Citizens BancShares has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500.

Profitability

This table compares 1st Source and First Citizens BancShares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
1st Source	28.09%	12.94%	1.87%
First Citizens BancShares	16.28%	12.07%	1.06%

Insider & Institutional Ownership

74.5% of 1st Source shares are owned by institutional investors. Comparatively, 78.0% of First Citizens BancShares shares are owned by institutional investors. 20.2% of 1st Source shares are owned by company insiders. Comparatively, 14.6% of First Citizens BancShares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares 1st Source and First Citizens BancShares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
1st Source	$600.00 million	3.50	$158.28 million	$6.52	13.37
First Citizens BancShares	$14.51 billion	1.69	$2.21 billion	$187.04	11.62

First Citizens BancShares has higher revenue and earnings than 1st Source. First Citizens BancShares is trading at a lower price-to-earnings ratio than 1st Source, indicating that it is currently the more affordable of the two stocks.

Dividends

1st Source pays an annual dividend of $1.80 per share and has a dividend yield of 2.1%. First Citizens BancShares pays an annual dividend of $8.40 per share and has a dividend yield of 0.4%. 1st Source pays out 27.6% of its earnings in the form of a dividend. First Citizens BancShares pays out 4.5% 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. 1st Source has increased its dividend for 38 consecutive years and First Citizens BancShares has increased its dividend for 8 consecutive years. 1st Source is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current ratings and target prices for 1st Source and First Citizens BancShares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
1st Source	0	2	2	1	2.80
First Citizens BancShares	0	10	3	1	2.36

1st Source presently has a consensus price target of $89.67, suggesting a potential upside of 2.88%. First Citizens BancShares has a consensus price target of $2,278.31, suggesting a potential upside of 4.85%. Given First Citizens BancShares’ higher probable upside, analysts plainly believe First Citizens BancShares is more favorable than 1st Source.

Summary

1st Source beats First Citizens BancShares on 9 of the 17 factors compared between the two stocks.

About 1st Source

1st Source Corporation operates as the bank holding company for 1st Source Bank that provides commercial and consumer banking services, trust and wealth advisory services, and insurance products to individual and business clients. Its consumer banking services include checking and savings accounts; certificates of deposit; individual retirement accounts; online and mobile banking products; consumer loans, real estate mortgage loans, and home equity lines of credit; and financial planning, financial literacy, and other consultative services, as well as debit and credit cards. The company also offers commercial, small business, agricultural, and real estate loans for general corporate purposes, including financing for industrial and commercial properties, equipment, inventories, accounts receivables, and renewable energy and acquisition financing; and commercial leasing, treasury management, and retirement planning services. In addition, it provides trust, investment, agency, and custodial services comprising administration of estates and personal trusts, as well as management of investment accounts for individuals, employee benefit plans, and charitable foundations. Further, the company offers equipment loan and lease products for construction equipment, new and pre-owned aircraft, auto and light trucks, and medium and heavy duty trucks; and finances construction equipment, aircrafts, medium and heavy duty trucks, step vans, vocational work trucks, motor coaches, shuttle buses, funeral cars, automobiles, and other equipment. Additionally, it provides corporate and personal property, casualty, and individual and group health and life insurance products and services. 1st Source Corporation was founded in 1863 and is headquartered in South Bend, Indiana.

About First Citizens BancShares

First Citizens BancShares, Inc. operates as the holding company for First-Citizens Bank & Trust Company that provides retail and commercial banking services to individuals, businesses, and professionals. The company's deposit products include checking, savings, money market, and time deposit accounts. Its loan product portfolio comprises commercial construction and mortgage; and commercial and industrial leases, as well as small business administration loans. In addition, the company offers consumer loans, such as residential and revolving mortgage, consumer auto, and other consumer loans. Further, it provides wealth management services, including annuities, brokerage services, and third-party mutual funds, as well as investment management and advisory services. The company provides its products and services through its branch network. First Citizens BancShares, Inc. was founded in 1898 and is headquartered in Raleigh, North Carolina.