Critical Analysis: Fvcbankcorp (NASDAQ:FVCB) versus Southern First Bancshares (NASDAQ:SFST)

Fvcbankcorp (NASDAQ:FVCB) and Southern First Bancshares (NASDAQ:SFST) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, valuation, profitability, institutional ownership, risk and earnings.

Risk and Volatility

Fvcbankcorp has a beta of 0.35, meaning that its share price is 65% less volatile than the S&P 500. Comparatively, Southern First Bancshares has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500.

Earnings and Valuation

This table compares Fvcbankcorp and Southern First Bancshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fvcbankcorp	$115.85 million	1.88	$15.06 million	$1.10	10.98
Southern First Bancshares	$213.35 million	1.62	$15.53 million	$2.70	15.62

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

Profitability

This table compares Fvcbankcorp and Southern First Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fvcbankcorp	17.08%	8.57%	0.90%
Southern First Bancshares	10.09%	6.52%	0.52%

Analyst Recommendations

This is a breakdown of current ratings for Fvcbankcorp and Southern First Bancshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fvcbankcorp	0	2	1	0	2.33
Southern First Bancshares	0	2	1	0	2.33

Fvcbankcorp presently has a consensus target price of $16.00, indicating a potential upside of 32.45%. Southern First Bancshares has a consensus target price of $51.00, indicating a potential upside of 20.91%. Given Fvcbankcorp’s higher probable upside, equities analysts clearly believe Fvcbankcorp is more favorable than Southern First Bancshares.

Insider & Institutional Ownership

43.6% of Fvcbankcorp shares are held by institutional investors. Comparatively, 75.0% of Southern First Bancshares shares are held by institutional investors. 14.0% of Fvcbankcorp shares are held by insiders. Comparatively, 7.1% of Southern First Bancshares shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

About Fvcbankcorp

FVCBankcorp, Inc. operates as the bank holding company for FVCbank that provides various banking products and services in Virginia. It offers deposit products, including interest and noninterest-bearing transaction accounts, savings accounts, money market accounts, and certificates of deposit. The company also provides commercial real estate loans; commercial construction loans; commercial loans for various business purposes, such as for working capital, equipment purchases, lines of credit, and government contract financing; small business administration loans; asset-based loans and accounts receivable financing; home equity loans; and consumer loans. In addition, it offers business and consumer credit cards; merchant services; business insurance products; and online banking, remote deposit, and mobile banking services. The company serves commercial businesses, nonprofit organizations, professional service entities, and their respective owners and employees located in the greater Washington, D.C., and Baltimore metropolitan areas. It operates branch offices in Arlington, Virginia; the independent city of Manassas, Virginia; Reston, Fairfax County, Virginia; Springfield, Fairfax County in Virginia; and Montgomery County and Baltimore in Maryland, and Washington, D.C. FVCBankcorp, Inc. was founded in 2007 and is headquartered in Fairfax, Virginia.

About Southern First Bancshares

Southern First Bancshares, Inc. operates as the bank holding company for Southern First Bank that provides commercial, consumer, and mortgage loans to the general public in South Carolina, North Carolina, and Georgia. The company accepts various deposit products that include checking accounts, commercial checking accounts, and savings accounts, as well as other time deposits, including daily money market accounts and long-term certificates of deposit. Its loan portfolio comprises commercial real estate loans; construction real estate loans; commercial business loans for various lines of businesses, such as the manufacturing, service industry, and professional service areas; consumer real estate and home equity loans; and other consumer loans, including secured and unsecured installment loans and revolving lines of credit. In addition, the company provides other bank services, such as internet banking, cash management, safe deposit boxes, direct deposit, automatic drafts, bill payment, and mobile banking services. Southern First Bancshares, Inc. was incorporated in 1999 and is headquartered in Greenville, South Carolina.