Contrasting First Guaranty Bancshares (NASDAQ:FGBI) & Peoples Financial (OTCMKTS:PFBX)

Peoples Financial (OTCMKTS:PFBX) and First Guaranty Bancshares (NASDAQ:FGBI) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, institutional ownership, profitability, earnings, dividends, risk and analyst recommendations.

Valuation and Earnings

This table compares Peoples Financial and First Guaranty Bancshares”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Peoples Financial	$35.66 million	2.75	$3.91 million	$0.88	24.15
First Guaranty Bancshares	$221.76 million	0.74	-$56.02 million	($3.20)	-3.12

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

Volatility and Risk

Peoples Financial has a beta of 0.21, indicating that its share price is 79% less volatile than the S&P 500. Comparatively, First Guaranty Bancshares has a beta of 0.44, indicating that its share price is 56% less volatile than the S&P 500.

Dividends

Peoples Financial pays an annual dividend of $0.36 per share and has a dividend yield of 1.7%. First Guaranty Bancshares pays an annual dividend of $0.04 per share and has a dividend yield of 0.4%. Peoples Financial pays out 40.9% of its earnings in the form of a dividend. First Guaranty Bancshares pays out -1.3% 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.

Profitability

This table compares Peoples Financial and First Guaranty Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Peoples Financial	11.31%	4.06%	0.53%
First Guaranty Bancshares	-21.47%	-17.06%	-0.87%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Peoples Financial and First Guaranty Bancshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Peoples Financial	0	0	0	0	0.00
First Guaranty Bancshares	1	1	0	0	1.50

Insider & Institutional Ownership

32.8% of Peoples Financial shares are owned by institutional investors. Comparatively, 39.5% of First Guaranty Bancshares shares are owned by institutional investors. 28.1% of Peoples Financial shares are owned by insiders. Comparatively, 47.2% of First Guaranty Bancshares shares are owned 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.

Summary

Peoples Financial beats First Guaranty Bancshares on 8 of the 14 factors compared between the two stocks.

About Peoples Financial

Peoples Financial Corporation operates as the bank holding company for The Peoples Bank that provides banking, financial, and trust services to government entities, individuals, and small and commercial businesses in Mississippi. The company accepts various deposits, such as interest and non-interest-bearing checking accounts, savings accounts, certificates of deposit, and individual retirement accounts (IRAs). It offers business, commercial, real estate, construction, personal, and installment loans; and personal trust, agencies, and estate services, including living and testamentary trusts, executorships, guardianships, and conservatorships. In addition, the company provides self-directed IRAs; and escrow management, stock transfer, and bond paying agency accounts to corporate customers. Further, it offers other services consisting of safe deposit box rental, wire transfer, night drop facilities, collection, cash management, and Internet banking services. the company provides services to customers of various industries, such as seafood, retail, hospitality, hotel/motel, gaming, and construction. Peoples Financial Corporation was founded in 1896 and is headquartered in Biloxi, Mississippi.

About First Guaranty Bancshares

First Guaranty Bancshares, Inc. operates as the holding company for First Guaranty Bank that provides commercial banking services in Louisiana and Texas. It offers various deposit products, including personal and business checking, savings, money market, and demand accounts, as well as time deposits to consumers, small businesses, and municipalities. The company provides loans, such as non-farm, non-residential loans secured by real estate, commercial and industrial loans, one- to four-family residential loans, multifamily loans, construction and land development loans, agricultural loans, farmland loans, and consumer and other loans to small to medium-sized businesses and professionals, and individuals. In addition, it offers a range of consumer services, including credit cards, mobile deposit capture, safe deposit boxes, official checks, online and mobile banking, automated teller machines, and online bill pay; provides additional solutions, such as merchant services, remote deposit capture, and lockbox services to business customers; and invests a portion of its assets in securities issued by the United States Government and its agencies, state and municipal obligations, corporate debt securities, mutual funds, and equity securities, as well as invests in mortgage-backed securities primarily issued or guaranteed by United States Government agencies or enterprises. First Guaranty Bancshares, Inc. was founded in 1934 and is headquartered in Hammond, Louisiana.