The First Bancshares (NASDAQ: FBMS) and Atlantic Capital Bancshares (NASDAQ:ACBI) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, dividends, analyst recommendations, earnings and profitability.

Analyst Recommendations

This is a breakdown of recent ratings for The First Bancshares and Atlantic Capital Bancshares, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The First Bancshares 0 0 1 0 3.00
Atlantic Capital Bancshares 0 3 1 0 2.25

The First Bancshares currently has a consensus target price of $30.00, indicating a potential downside of 0.50%. Atlantic Capital Bancshares has a consensus target price of $21.50, indicating a potential upside of 18.46%. Given Atlantic Capital Bancshares’ higher possible upside, analysts plainly believe Atlantic Capital Bancshares is more favorable than The First Bancshares.

Dividends

The First Bancshares pays an annual dividend of $0.15 per share and has a dividend yield of 0.5%. Atlantic Capital Bancshares does not pay a dividend. The First Bancshares pays out 13.8% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares The First Bancshares and Atlantic Capital Bancshares’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
The First Bancshares $62.19 million 4.43 $9.97 million $1.09 27.66
Atlantic Capital Bancshares $90.67 million 5.14 $13.60 million $0.53 34.25

Atlantic Capital Bancshares has higher revenue and earnings than The First Bancshares. The First Bancshares is trading at a lower price-to-earnings ratio than Atlantic Capital Bancshares, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

The First Bancshares has a beta of -0.31, suggesting that its share price is 131% less volatile than the S&P 500. Comparatively, Atlantic Capital Bancshares has a beta of 1.04, suggesting that its share price is 4% more volatile than the S&P 500.

Insider & Institutional Ownership

57.9% of The First Bancshares shares are held by institutional investors. Comparatively, 78.3% of Atlantic Capital Bancshares shares are held by institutional investors. 11.8% of The First Bancshares shares are held by insiders. Comparatively, 4.6% of Atlantic Capital Bancshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares The First Bancshares and Atlantic Capital Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The First Bancshares 12.23% 8.95% 0.84%
Atlantic Capital Bancshares 12.18% 4.45% 0.50%

Summary

Atlantic Capital Bancshares beats The First Bancshares on 8 of the 15 factors compared between the two stocks.

The First Bancshares Company Profile

The First Bancshares, Inc. is a bank holding company for The First, A National Banking Association (the Bank). The Company and the Bank engage in a general commercial and retail banking business for small to medium-sized businesses, professional concerns and individuals. The Bank provides a range of banking services in its primary market area of South Mississippi, South Alabama and Louisiana. The Bank offers a range of commercial and personal loans. Commercial loans include both secured and unsecured loans for working capital (including loans secured by inventory and accounts receivable), business expansion (including acquisition of real estate and improvements), and purchase of equipment and machinery. The Bank offers a range of deposit services, including noninterest-bearing accounts, negotiable order of withdrawal (NOW) accounts, money market accounts, savings accounts and time deposits.

Atlantic Capital Bancshares Company Profile

Atlantic Capital Bancshares, Inc. is the bank holding company for Atlantic Capital Bank (the Bank). The Bank operates as a commercial bank. The Bank provides an array of credit, treasury management and deposit products and services to growth businesses, middle market corporations, commercial real estate developers and investors, and private clients. Its wealth management division offers financial planning, trust administration, investment management, brokerage and estate planning services. It also provides selected capital markets, mortgage banking, and electronic banking services to its corporate, business and individual clients. Its private banking credit products include loans to individuals for personal and investment purposes, such as secured installment and term loans, and home equity lines of credit. Its specialty corporate financial services include payments industry banking, financial institutions banking, capital markets services and specialty commercial lending.

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