Reviewing Southside Bancshares (NYSE:SBSI) & Intercorp Financial Services (NYSE:IFS)

Southside Bancshares (NYSE:SBSI) and Intercorp Financial Services (NYSE:IFS) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Analyst Ratings

This is a breakdown of recent recommendations for Southside Bancshares and Intercorp Financial Services, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southside Bancshares	1	4	1	0	2.00
Intercorp Financial Services	0	1	1	1	3.00

Southside Bancshares presently has a consensus target price of $34.75, suggesting a potential upside of 12.47%. Intercorp Financial Services has a consensus target price of $62.00, suggesting a potential upside of 12.50%. Given Intercorp Financial Services’ stronger consensus rating and higher probable upside, analysts plainly believe Intercorp Financial Services is more favorable than Southside Bancshares.

Dividends

Southside Bancshares pays an annual dividend of $1.48 per share and has a dividend yield of 4.8%. Intercorp Financial Services pays an annual dividend of $1.71 per share and has a dividend yield of 3.1%. Southside Bancshares pays out 58.3% of its earnings in the form of a dividend. Intercorp Financial Services pays out 31.3% 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. Southside Bancshares has increased its dividend for 30 consecutive years and Intercorp Financial Services has increased its dividend for 1 consecutive years. Southside Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

55.7% of Southside Bancshares shares are held by institutional investors. 5.1% of Southside Bancshares shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Southside Bancshares has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Intercorp Financial Services has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500.

Earnings and Valuation

This table compares Southside Bancshares and Intercorp Financial Services”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Southside Bancshares	$419.03 million	2.20	$69.18 million	$2.54	12.16
Intercorp Financial Services	$1.67 billion	3.67	$542.25 million	$5.47	10.07

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

Profitability

This table compares Southside Bancshares and Intercorp Financial Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Southside Bancshares	16.70%	11.16%	1.11%
Intercorp Financial Services	34.81%	17.06%	2.10%

Summary

Intercorp Financial Services beats Southside Bancshares on 12 of the 17 factors compared between the two stocks.

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 deposit. 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, revocable and testamentary trusts, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. As of December 31, 2021, the company operated through 56 banking facilities and 73 ATMs/ITMs. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.

About Intercorp Financial Services

Intercorp Financial Services Inc., together with its subsidiaries, offers banking, insurance, wealth management, and payment services for retail and commercial clients in Peru. The company provides loans, credit facilities, deposits, and current accounts; life annuity products with single-premium payment and conventional life insurance products, as well as other retail insurance products; and brokerage and investment management services. It engages in the development, management, operation, and processing of credit and debit cards; facilitation of payments and services through commercial stores; and installation and maintenance of infrastructure for transactions through electronic commerce modality and networks of payment methods processors. The company was incorporated in 1897 and is based in Lima, Peru. Intercorp Financial Services Inc. operates as a subsidiary of Intercorp Perú Ltd.