Contrasting United Security Bancshares (NASDAQ:UBFO) and Guaranty Bancshares (NASDAQ:GNTY)

United Security Bancshares (NASDAQ:UBFO) and Guaranty Bancshares (NASDAQ:GNTY) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, dividends, valuation and institutional ownership.

Dividends

United Security Bancshares pays an annual dividend of $0.48 per share and has a dividend yield of 6.6%. Guaranty Bancshares pays an annual dividend of $0.96 per share and has a dividend yield of 3.2%. United Security Bancshares pays out 46.2% of its earnings in the form of a dividend. Guaranty Bancshares pays out 39.3% 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. United Security Bancshares has increased its dividend for 1 consecutive years and Guaranty Bancshares has increased its dividend for 7 consecutive years.

Institutional and Insider Ownership

30.9% of United Security Bancshares shares are owned by institutional investors. Comparatively, 39.4% of Guaranty Bancshares shares are owned by institutional investors. 20.1% of United Security Bancshares shares are owned by company insiders. Comparatively, 26.4% of Guaranty Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

United Security Bancshares has a beta of 0.62, indicating that its share price is 38% less volatile than the S&P 500. Comparatively, Guaranty Bancshares has a beta of 0.55, indicating that its share price is 45% less volatile than the S&P 500.

Profitability

This table compares United Security Bancshares and Guaranty Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Security Bancshares	27.07%	15.14%	1.42%
Guaranty Bancshares	15.56%	8.74%	0.82%

Valuation & Earnings

This table compares United Security Bancshares and Guaranty Bancshares’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Security Bancshares	$65.95 million	1.91	$19.80 million	$1.04	7.01
Guaranty Bancshares	$179.01 million	1.95	$30.04 million	$2.44	12.41

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

Analyst Ratings

This is a breakdown of recent ratings and price targets for United Security Bancshares and Guaranty Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Security Bancshares	0	0	0	0	N/A
Guaranty Bancshares	0	2	1	0	2.33

Guaranty Bancshares has a consensus price target of $33.33, suggesting a potential upside of 10.08%. Given Guaranty Bancshares’ higher possible upside, analysts clearly believe Guaranty Bancshares is more favorable than United Security Bancshares.

Summary

Guaranty Bancshares beats United Security Bancshares on 11 of the 16 factors compared between the two stocks.

About United Security Bancshares

United Security Bancshares operates as the bank holding company for United Security Bank, a state-chartered bank that provides a range of commercial banking services to the business and professional community, and individuals in California. The company accepts various deposit products, including personal and business checking accounts, savings accounts, interest-bearing negotiable order of withdrawal accounts, money market accounts, and time certificates of deposit. It also provides real estate mortgage, commercial and industrial, real estate construction and development, and consumer loans, as well as agricultural, installment, and student loans. In addition, the company offers online and mobile banking, safe deposit boxes, wire transfers, payroll direct deposit, cashier's check, cash management, and foreign draft services, as well as interactive teller machines; and person-to-person and bank-to-bank transfers for consumer customers. United Security Bancshares was founded in 1987 and is headquartered in Fresno, California.

About Guaranty Bancshares

Guaranty Bancshares, Inc. operates as the bank holding company for Guaranty Bank & Trust, N.A. that provides a range of commercial and consumer banking products and services for small- and medium-sized businesses, professionals, and individuals. The company offers checking and savings, money market, and business accounts, as well as certificates of deposit; and commercial and industrial, construction and development, 1-4 family residential, commercial real estate, farmland, agricultural, multi-family residential, and consumer loans. It also provides trustee, custodial and escrow, investment management, retirement plan, ATM, night depository, direct deposit, and cashier's check services, as well as online and mobile banking services; debit cards; letters of credit; and treasury management services, including wire transfer, positive pay, remote deposit capture, and automated clearinghouse services. Guaranty Bancshares, Inc. was founded in 1913 and is headquartered in Addison, Texas.