Head-To-Head Analysis: Regions Financial (NYSE:RF) versus First Bancorp (NASDAQ:FBNC)

First Bancorp (NASDAQ:FBNC) and Regions Financial (NYSE:RF) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, dividends, risk and institutional ownership.

Insider & Institutional Ownership

68.4% of First Bancorp shares are held by institutional investors. Comparatively, 79.4% of Regions Financial shares are held by institutional investors. 2.0% of First Bancorp shares are held by insiders. Comparatively, 0.3% of Regions Financial shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

First Bancorp pays an annual dividend of $0.96 per share and has a dividend yield of 1.5%. Regions Financial pays an annual dividend of $1.06 per share and has a dividend yield of 3.4%. First Bancorp pays out 29.8% of its earnings in the form of a dividend. Regions Financial pays out 43.3% 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. Regions Financial has raised its dividend for 12 consecutive years. Regions Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares First Bancorp and Regions Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Bancorp	22.12%	11.31%	1.46%
Regions Financial	23.33%	12.88%	1.42%

Valuation & Earnings

This table compares First Bancorp and Regions Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Bancorp	$549.30 million	4.73	$111.05 million	$3.22	19.48
Regions Financial	$9.61 billion	2.74	$2.16 billion	$2.45	12.58

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

Volatility & Risk

First Bancorp has a beta of 0.8, indicating that its stock price is 20% less volatile than the S&P 500. Comparatively, Regions Financial has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.

Analyst Recommendations

This is a summary of current ratings for First Bancorp and Regions Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Bancorp	0	3	3	1	2.71
Regions Financial	4	10	6	0	2.10

First Bancorp presently has a consensus target price of $65.55, suggesting a potential upside of 4.48%. Regions Financial has a consensus target price of $32.21, suggesting a potential upside of 4.48%. Given Regions Financial’s higher probable upside, analysts clearly believe Regions Financial is more favorable than First Bancorp.

Summary

Regions Financial beats First Bancorp on 10 of the 18 factors compared between the two stocks.

About First Bancorp

First Bancorp operates as the bank holding company for First Bank that provides banking products and services for individuals and small to medium-sized businesses. The company accepts deposit products, such as checking, savings, and money market accounts, as well as time deposits, including certificate of deposits and individual retirement accounts. It also offers loans for a range of consumer and commercial purposes comprising loans for business, real estate, personal, home improvement, and automobiles, as well as residential mortgages and small business administration loans; and accounts receivable financing and factoring, inventory financing, and purchase order financing services. In addition, the company provides credit and debit cards, letter of credits, and safe deposit box rental services, as well as electronic funds transfer services consisting of wire transfers; and internet and mobile banking, cash management, bank-by-phone services, and remote deposit capture services. Further, it offers investment and insurance products, such as mutual funds, annuities, long-term care insurance, life insurance, and company retirement plans, as well as property and casualty insurance products; and financial planning services. The company was founded in 1934 and is headquartered in Southern Pines, North Carolina.

About Regions Financial

Regions Financial Corporation, a financial holding company, provides banking and bank-related services to individual and corporate customers. It operates through three segments: Corporate Bank, Consumer Bank, and Wealth Management. The Corporate Bank segment offers commercial banking services, such as commercial and industrial, commercial real estate, and investor real estate lending; equipment lease financing; deposit products; and securities underwriting and placement, loan syndication and placement, foreign exchange, derivatives, merger and acquisition, and other advisory services. It serves corporate, middle market, and commercial real estate developers and investors. The Consumer Bank segment provides consumer banking products and services related to residential first mortgages, home equity lines and loans, consumer credit cards, and other consumer loans, as well as deposits. The Wealth Management segment offers credit related products, and retirement and savings solutions; and trust and investment management, asset management, and estate planning services to individuals, businesses, governmental institutions, and non-profit entities. It also provides investment and insurance products; low-income housing tax credit corporate fund syndication services; and other specialty financing services. The company was founded in 1971 and is headquartered in Birmingham, Alabama.