Head to Head Review: Orange County Bancorp (NASDAQ:OBT) and Southside Bancshares (NASDAQ:SBSI)

Orange County Bancorp (NASDAQ:OBT) and Southside Bancshares (NASDAQ:SBSI) 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, earnings, analyst recommendations, valuation, profitability, dividends and risk.

Analyst Ratings

This is a summary of current ratings for Orange County Bancorp and Southside Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Orange County Bancorp	0	0	2	0	3.00
Southside Bancshares	0	3	0	0	2.00

Orange County Bancorp currently has a consensus price target of $33.00, suggesting a potential upside of 22.91%. Southside Bancshares has a consensus price target of $37.00, suggesting a potential upside of 24.57%. Given Southside Bancshares’ higher possible upside, analysts plainly believe Southside Bancshares is more favorable than Orange County Bancorp.

Institutional & Insider Ownership

42.5% of Orange County Bancorp shares are held by institutional investors. Comparatively, 55.7% of Southside Bancshares shares are held by institutional investors. 9.3% of Orange County Bancorp shares are held by insiders. Comparatively, 6.0% of Southside Bancshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

Orange County Bancorp has a beta of 0.46, meaning that its share price is 54% less volatile than the S&P 500. Comparatively, Southside Bancshares has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500.

Dividends

Orange County Bancorp pays an annual dividend of $0.52 per share and has a dividend yield of 1.9%. Southside Bancshares pays an annual dividend of $1.44 per share and has a dividend yield of 4.8%. Orange County Bancorp pays out 21.6% of its earnings in the form of a dividend. Southside Bancshares pays out 49.5% 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. Southside Bancshares has raised its dividend for 30 consecutive years. Southside Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Orange County Bancorp and Southside Bancshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Orange County Bancorp	$108.43 million	2.82	$27.88 million	$2.41	11.14
Southside Bancshares	$258.81 million	3.47	$88.49 million	$2.91	10.21

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

Profitability

This table compares Orange County Bancorp and Southside Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Orange County Bancorp	19.47%	15.51%	1.12%
Southside Bancshares	19.40%	11.10%	1.06%

Summary

Southside Bancshares beats Orange County Bancorp on 9 of the 17 factors compared between the two stocks.

About Orange County Bancorp

Orange County Bancorp, Inc., through its subsidiaries, provides commercial and consumer banking products and services, and trust and wealth management services to small businesses, middle-market enterprises, local municipal governments, and individuals. It accepts various deposits, including interest-bearing and noninterest-bearing demand accounts, money market deposit accounts, savings accounts, and certificates of deposit. The company also offers commercial real estate loans, commercial and industrial loans, commercial real estate construction loans, residential real estate loans, home equity loans, and consumer loans. In addition, it provides traditional trust and administration, asset management, financial planning, and wealth management services. The company operates full-service branches and loan production office in Orange, Westchester, Rockland, and Bronx counties in New York. Orange County Bancorp, Inc. was founded in 1892 and is headquartered in Middletown, New York.

About Southside Bancshares

Southside Bancshares, Inc. operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations. Its deposit products include savings, money market, and interest and noninterest bearing checking accounts, as well as certificates of deposits. The company’s loan portfolio comprises consumer loans that include 1-4 family residential loans, home equity loans, home improvement loans, automobile loans, and other consumer related loans; commercial loans, such as short-term working capital loans for inventory and accounts receivable, short and medium-term loans for equipment or other business capital expansion, commercial real estate loans, and municipal loans; and construction loans for 1-4 family residential and commercial real estate. It also offers wealth management and trust services consisting of investment management, administration of irrevocable, revocable, and testamentary trusts, estate administration, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. In addition, the company provides retirement and employee benefit accounts, including plans and profit sharing plans; and telephone, internet, and mobile banking services. The company offers various banking services through branches, drive-thru facilities, automated teller machines, and interactive teller machines. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.