Comparing South Plains Financial (NASDAQ:SPFI) and John Marshall Bancorp (NASDAQ:JMSB)

John Marshall Bancorp (NASDAQ:JMSB) and South Plains Financial (NASDAQ:SPFI) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, dividends, analyst recommendations and risk.

Analyst Ratings

This is a breakdown of current recommendations for John Marshall Bancorp and South Plains Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
John Marshall Bancorp	0	1	2	1	3.00
South Plains Financial	0	1	6	0	2.86

John Marshall Bancorp presently has a consensus target price of $25.00, suggesting a potential upside of 8.23%. South Plains Financial has a consensus target price of $49.60, suggesting a potential upside of 17.20%. Given South Plains Financial’s higher probable upside, analysts clearly believe South Plains Financial is more favorable than John Marshall Bancorp.

Insider & Institutional Ownership

39.1% of John Marshall Bancorp shares are owned by institutional investors. Comparatively, 54.9% of South Plains Financial shares are owned by institutional investors. 12.6% of John Marshall Bancorp shares are owned by insiders. Comparatively, 24.3% of South Plains Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Risk and Volatility

John Marshall Bancorp has a beta of 0.58, indicating that its stock price is 42% less volatile than the S&P 500. Comparatively, South Plains Financial has a beta of 0.46, indicating that its stock price is 54% less volatile than the S&P 500.

Earnings and Valuation

This table compares John Marshall Bancorp and South Plains Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
John Marshall Bancorp	$115.33 million	2.83	$21.23 million	$1.73	13.35
South Plains Financial	$296.89 million	2.69	$58.47 million	$3.67	11.53

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

Profitability

This table compares John Marshall Bancorp and South Plains Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
John Marshall Bancorp	20.41%	9.16%	1.04%
South Plains Financial	20.79%	12.36%	1.37%

Dividends

John Marshall Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 1.7%. South Plains Financial pays an annual dividend of $0.72 per share and has a dividend yield of 1.7%. John Marshall Bancorp pays out 23.1% of its earnings in the form of a dividend. South Plains Financial pays out 19.6% 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. South Plains Financial has increased its dividend for 5 consecutive years.

Summary

South Plains Financial beats John Marshall Bancorp on 12 of the 18 factors compared between the two stocks.

About John Marshall Bancorp

John Marshall Bancorp, Inc. is the bank holding company for John Marshall Bank. The Bank is headquartered in Reston, Virginia with eight full-service branches located in Alexandria, Arlington, Loudoun, Prince William, Reston, and Tysons, Virginia, as well as Rockville, Maryland, and Washington, D.C. The Bank is dedicated to providing exceptional value, personalized service and convenience to local businesses and professionals in the Washington, D.C. Metropolitan area. The Bank offers a comprehensive line of sophisticated banking products and services that rival those of the largest banks along with experienced staff to help achieve customers’ financial goals. Dedicated relationship managers serve as direct points-of-contact, providing subject matter expertise in a variety of niche industries including charter and private schools, government contractors, health services, nonprofits and associations, professional services, property management companies and title companies

About South Plains Financial

South Plains Financial, Inc. operates as a bank holding company for City Bank that provides commercial and consumer financial services to small and medium-sized businesses and individuals. The company operates through two segments, Banking and Insurance. It offers deposit products, including demand deposit accounts, interest-bearing products, savings accounts, and certificate of deposits. The company also provides commercial real estate loans; general and specialized commercial loans, including agricultural production and real estate, energy, finance, investment, and insurance loans, as well as loans to goods, services, restaurant and retail, construction, and other industries; residential construction loans; and 1-4 family residential loans, auto loans, and other loans for recreational vehicles or other purposes. In addition, it offers crop insurance products; trust products and services; investment services; mortgage banking services; online and mobile banking services; and debit and credit cards. The company was founded in 1941 and is headquartered in Lubbock, Texas.