Reviewing Enterprise Financial Services (NASDAQ:EFSC) & First Busey (NASDAQ:BUSE)

Enterprise Financial Services (NASDAQ:EFSC) and First Busey (NASDAQ:BUSE) are both mid-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, risk, dividends, earnings and valuation.

Valuation and Earnings

This table compares Enterprise Financial Services and First Busey”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Enterprise Financial Services	$1.00 billion	2.24	$201.37 million	$5.30	11.58
First Busey	$1.04 billion	2.23	$135.26 million	$2.25	12.26

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

Profitability

This table compares Enterprise Financial Services and First Busey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Enterprise Financial Services	19.81%	10.35%	1.19%
First Busey	19.16%	10.19%	1.36%

Volatility & Risk

Enterprise Financial Services has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500. Comparatively, First Busey has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for Enterprise Financial Services and First Busey, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Enterprise Financial Services	0	1	4	0	2.80
First Busey	0	3	4	0	2.57

Enterprise Financial Services presently has a consensus target price of $66.00, suggesting a potential upside of 7.58%. First Busey has a consensus target price of $27.50, suggesting a potential downside of 0.29%. Given Enterprise Financial Services’ stronger consensus rating and higher probable upside, analysts plainly believe Enterprise Financial Services is more favorable than First Busey.

Dividends

Enterprise Financial Services pays an annual dividend of $1.32 per share and has a dividend yield of 2.2%. First Busey pays an annual dividend of $1.04 per share and has a dividend yield of 3.8%. Enterprise Financial Services pays out 24.9% of its earnings in the form of a dividend. First Busey pays out 46.2% 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. Enterprise Financial Services has increased its dividend for 11 consecutive years and First Busey has increased its dividend for 10 consecutive years.

Institutional & Insider Ownership

72.2% of Enterprise Financial Services shares are held by institutional investors. Comparatively, 56.5% of First Busey shares are held by institutional investors. 2.2% of Enterprise Financial Services shares are held by insiders. Comparatively, 3.8% of First Busey shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Enterprise Financial Services beats First Busey on 11 of the 16 factors compared between the two stocks.

About Enterprise Financial Services

Enterprise Financial Services Corp operates as the holding company for Enterprise Bank & Trust that offers banking and wealth management services to individuals and corporate customers primarily in Arizona, California, Florida, Kansas, Missouri, Nevada, and New Mexico. It provides checking, savings, money market accounts, and certificates of deposit. The company also provides commercial and industrial, commercial real estate, real estate construction and development, residential real estate, small business administration, agricultural, consumer, and other loan products. In addition, it offers treasury management and international trade services; tax credit brokerage services; life insurance premium and sponsor finance; tax credit related lending; other deposit accounts, such as community associations, property management, third party escrow, and trust services; treasury management product and services; customized solutions and products; cash management; fiduciary, investment management, and financial advisory services; and customer hedging products, including international banking, card services, and tax credit businesses. Further, the company provides online, device applications, text, and voice banking; remote deposit capture; internet banking, mobile banking, cash management, positive pay services, fraud detection and prevention, automated payables, check image, and statement and document imaging; and controlled disbursements, repurchase agreements, and sweep investment accounts. Enterprise Financial Services Corp was founded in 1988 and is headquartered in Clayton, Missouri.

About First Busey

First Busey Corporation operates as the bank holding company for Busey Bank that engages in the provision of retail and commercial banking products and services to individual, corporate, institutional, and governmental customers in the United States. It operates through three segments: Banking, Wealth Management, and FirsTech. The Banking segment provides banking services to individual customers, such as demand and savings deposits, money transfers, safe deposit services, individual retirement accounts and other fiduciary services, automated teller machines, and technology-based networks, as well as loan products, including residential real estate, home equity lines of credit, and consumer loans. This segment also offers banking services to corporate customers, including commercial, commercial real estate, real estate construction, and agricultural loans, as well as cash management services. The Wealth Management segment offers a range of investment and asset management, investment, brokerage, investment strategy consulting, fiduciary, philanthropic advisory, tax preparation, business succession planning, and employee retirement plan services to individuals, businesses, and foundations; and professional farm management services to the agricultural industry. The FirsTech segment provides payment technology solutions comprising online, mobile, and voice-recognition bill payments; money management and credit card networks; direct debit services; lockbox remittance processing for payments made by mail; and walk-in payments, as well as tools to help clients with billing, reconciliation, bill reminders, and treasury services. The company was founded in 1868 and is headquartered in Champaign, Illinois.