Reviewing National Bank (NYSE:NBHC) & United Bankshares (NASDAQ:UBSI)

National Bank (NYSE:NBHC) and United Bankshares (NASDAQ:UBSI) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, valuation, dividends, analyst recommendations and risk.

Risk and Volatility

National Bank has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500. Comparatively, United Bankshares has a beta of 0.71, meaning that its share price is 29% less volatile than the S&P 500.

Dividends

National Bank pays an annual dividend of $1.28 per share and has a dividend yield of 3.0%. United Bankshares pays an annual dividend of $1.52 per share and has a dividend yield of 3.2%. National Bank pays out 53.8% of its earnings in the form of a dividend. United Bankshares pays out 41.4% 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. National Bank has increased its dividend for 10 consecutive years and United Bankshares has increased its dividend for 26 consecutive years. United Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares National Bank and United Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
National Bank	15.11%	8.35%	1.13%
United Bankshares	27.97%	9.39%	1.53%

Earnings & Valuation

This table compares National Bank and United Bankshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
National Bank	$467.67 million	4.07	$109.57 million	$2.38	17.87
United Bankshares	$1.28 billion	5.15	$464.60 million	$3.67	13.06

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

Institutional & Insider Ownership

92.7% of National Bank shares are held by institutional investors. Comparatively, 70.8% of United Bankshares shares are held by institutional investors. 6.8% of National Bank shares are held by company insiders. Comparatively, 3.2% of United Bankshares shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for National Bank and United Bankshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
National Bank	0	2	5	0	2.71
United Bankshares	0	4	3	0	2.43

National Bank currently has a consensus price target of $46.80, suggesting a potential upside of 10.04%. United Bankshares has a consensus price target of $47.80, suggesting a potential downside of 0.29%. Given National Bank’s stronger consensus rating and higher possible upside, equities analysts plainly believe National Bank is more favorable than United Bankshares.

Summary

United Bankshares beats National Bank on 10 of the 17 factors compared between the two stocks.

About National Bank

National Bank Holdings Corporation operates as the bank holding company for NBH Bank that provides various banking products and financial services to commercial, business, and consumer clients in the United States. It offers deposit products, including checking, savings, money market, and other deposit accounts, including fixed-rate and fixed maturity time deposits. The company also provides commercial and industrial loans and leases, such as working capital loans, equipment loans, lender finance loans, food and agriculture loans, government and non-profit loans, owner occupied commercial real estate loans, and other commercial loans and leases; non-owner occupied commercial real estate loans consisting of loans on commercial properties, such as office buildings, warehouse/distribution buildings, multi-family, hospitality, and retail buildings; small business administration loans to support small businesses and entrepreneurs; term loans, line of credits, and real estate secured loans; residential real estate loans; and consumer loans. In addition, it offers treasury management solutions comprising online and mobile banking, commercial credit card, wire transfer, automated clearing house, electronic bill payment, lock box, remote deposit capture, merchant processing, cash vault, controlled disbursements, and fraud prevention services, as well as other auxiliary services, including account reconciliation, collections, repurchase accounts, zero balance accounts, and sweep accounts. The company operates through a network of banking centers located in Colorado, the greater Kansas City region, New Mexico, Utah, Wyoming, Idaho, and Texas. It also operates ATMs. The company was formerly known as NBH Holdings Corp. and changed its name to National Bank Holdings Corporation in March 2012. The company was incorporated in 2009 and is headquartered in Greenwood Village, Colorado.

About United Bankshares

United Bankshares, Inc., through its subsidiaries, primarily provides commercial and retail banking products and services in the United States. It operates through two segments, Community Banking and Mortgage Banking. The company accepts checking, savings, and time and money market accounts; individual retirement accounts; and demand deposits, statement and special savings, and NOW accounts. Its loan products include commercial loans and leases to small to mid-size industrial and commercial companies; construction and real estate loans, such as commercial and residential mortgages, and loans secured by owner-occupied real estate; personal, student, credit card receivables, personal, commercial, and floor plan loans; and home equity loans. In addition, the company provides credit cards; safe deposit boxes, wire transfers, and other banking products and services; investment and security services; services to correspondent banks, including buying and selling federal funds; automated teller machine services; and internet and telephone banking services. Further, it offers community banking services, such as asset management, real property title insurance, financial planning, mortgage banking, and brokerage services, as well as investment management and retirement planning services. United Bankshares, Inc. was incorporated in 1982 and is headquartered in Charleston, West Virginia.