Head-To-Head Contrast: First Bancorp (NASDAQ:FBNC) & Eastern Bankshares (NASDAQ:EBC)

Eastern Bankshares (NASDAQ:EBC) and First Bancorp (NASDAQ:FBNC) are both mid-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, risk, earnings, analyst recommendations and profitability.

Institutional & Insider Ownership

71.7% of Eastern Bankshares shares are held by institutional investors. Comparatively, 68.4% of First Bancorp shares are held by institutional investors. 1.3% of Eastern Bankshares shares are held by company insiders. Comparatively, 2.0% of First Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Eastern Bankshares and First Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eastern Bankshares	0	3	6	0	2.67
First Bancorp	0	3	2	1	2.67

Eastern Bankshares currently has a consensus price target of $24.86, suggesting a potential upside of 14.50%. First Bancorp has a consensus price target of $68.94, suggesting a potential upside of 7.51%. Given Eastern Bankshares’ higher probable upside, research analysts clearly believe Eastern Bankshares is more favorable than First Bancorp.

Risk and Volatility

Eastern Bankshares has a beta of 0.66, suggesting that its share price is 34% less volatile than the S&P 500. Comparatively, First Bancorp has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500.

Earnings & Valuation

This table compares Eastern Bankshares and First Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eastern Bankshares	$1.33 billion	3.74	$88.22 million	$1.76	12.34
First Bancorp	$549.30 million	4.83	$111.05 million	$3.22	19.91

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Eastern Bankshares	25.12%	8.71%	1.24%
First Bancorp	22.12%	11.31%	1.46%

Dividends

Eastern Bankshares pays an annual dividend of $0.60 per share and has a dividend yield of 2.8%. First Bancorp pays an annual dividend of $0.96 per share and has a dividend yield of 1.5%. Eastern Bankshares pays out 34.1% of its earnings in the form of a dividend. First Bancorp pays out 29.8% 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. Eastern Bankshares has increased its dividend for 5 consecutive years. Eastern Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

First Bancorp beats Eastern Bankshares on 10 of the 17 factors compared between the two stocks.

About Eastern Bankshares

Eastern Bankshares, Inc. operates as the bank holding company for Eastern Bank that provides banking products and services primarily to retail, commercial, and small business customers. The company provides deposit accounts, interest checking accounts, money market accounts, savings accounts, and time certificates of deposit accounts. It also offers commercial and industrial, commercial real estate and construction, small business, residential real estate, and home equity loans; lines of credit; and other consumer loans comprising unsecured personal lines of credit, overdraft protection, automobile loans, home improvement loans, airplane loans, and other personal loans. In addition, the company provides trust, financial planning and portfolio management, automated lock box collection, cash management, and account reconciliation services; personal, business, and employee benefits insurance products. Eastern Bankshares, Inc. was founded in 1818 and is headquartered in Boston, Massachusetts.

About First Bancorp

First Bancorp operates as the bank holding company for First Bank that provides banking products and services for individuals and small to medium-sized businesses. The company accepts deposit products, such as checking, savings, and money market accounts, as well as time deposits, including certificate of deposits and individual retirement accounts. It also offers loans for a range of consumer and commercial purposes comprising loans for business, real estate, personal, home improvement, and automobiles, as well as residential mortgages and small business administration loans; and accounts receivable financing and factoring, inventory financing, and purchase order financing services. In addition, the company provides credit and debit cards, letter of credits, and safe deposit box rental services, as well as electronic funds transfer services consisting of wire transfers; and internet and mobile banking, cash management, bank-by-phone services, and remote deposit capture services. Further, it offers investment and insurance products, such as mutual funds, annuities, long-term care insurance, life insurance, and company retirement plans, as well as property and casualty insurance products; and financial planning services. The company was founded in 1934 and is headquartered in Southern Pines, North Carolina.