American National BankShares (NASDAQ:AMNB) and First Horizon National (NYSE:FHN) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, profitability, analyst recommendations, institutional ownership, earnings, risk and valuation.
This table compares American National BankShares and First Horizon National’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|American National BankShares||19.35%||11.26%||1.43%|
|First Horizon National||19.35%||10.94%||1.25%|
American National BankShares has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500. Comparatively, First Horizon National has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500.
Earnings and Valuation
This table compares American National BankShares and First Horizon National’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|American National BankShares||$108.03 million||3.72||$20.91 million||$3.10||11.68|
|First Horizon National||$2.28 billion||2.21||$440.91 million||$1.66||9.73|
First Horizon National has higher revenue and earnings than American National BankShares. First Horizon National is trading at a lower price-to-earnings ratio than American National BankShares, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent ratings and recommmendations for American National BankShares and First Horizon National, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|American National BankShares||0||2||1||0||2.33|
|First Horizon National||0||3||5||0||2.63|
American National BankShares currently has a consensus target price of $39.00, suggesting a potential upside of 7.73%. First Horizon National has a consensus target price of $18.64, suggesting a potential upside of 15.36%. Given First Horizon National’s stronger consensus rating and higher possible upside, analysts clearly believe First Horizon National is more favorable than American National BankShares.
Insider & Institutional Ownership
38.0% of American National BankShares shares are owned by institutional investors. Comparatively, 81.9% of First Horizon National shares are owned by institutional investors. 5.0% of American National BankShares shares are owned by company insiders. Comparatively, 1.9% of First Horizon National shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
American National BankShares pays an annual dividend of $1.08 per share and has a dividend yield of 3.0%. First Horizon National pays an annual dividend of $0.56 per share and has a dividend yield of 3.5%. American National BankShares pays out 34.8% of its earnings in the form of a dividend. First Horizon National pays out 33.7% 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. American National BankShares has increased its dividend for 4 consecutive years and First Horizon National has increased its dividend for 4 consecutive years. First Horizon National is clearly the better dividend stock, given its higher yield and lower payout ratio.
First Horizon National beats American National BankShares on 9 of the 15 factors compared between the two stocks.
About American National BankShares
American National Bankshares Inc. operates as the bank holding company for American National Bank and Trust Company that provides financial products and services. The company operates through two segments, Community Banking, and Trust and Investment Services. It accepts deposit products, including checking, money market, savings, and consumer and commercial time deposits, as well as certificates of deposit. The company's loan products comprise commercial and residential real estate loans, commercial loans to small and medium-sized businesses, construction and land development loans, home equity loans, mortgage loans, and consumer loans. It also offers trust and investment services, such as estate planning, trust account administration, investment management, and retail brokerage services; online and telephone banking services; insurance services; and investment management services, including purchasing equity, fixed income, and mutual fund investments for customer accounts, as well as operates 34 automated teller machines. As of December 31, 2018, it operated 24 banking offices and 2 loan production offices in Roanoke, Virginia and Raleigh, North Carolina. American National Bankshares Inc. was founded in 1909 and is headquartered in Danville, Virginia.
About First Horizon National
First Horizon National Corporation operates as the bank holding company for First Tennessee Bank National Association that provides various financial services. It operates through four segments: Regional Banking, Fixed Income, Corporate, and Non-Strategic. The company offers general banking services for consumers, businesses, financial institutions, and governments. It is also involved in the underwriting of bank-eligible securities and other fixed-income securities eligible for underwriting by financial subsidiaries; loan sales; derivative sales; and provision of advisory services. In addition, the company offers brokerage services; correspondent banking services; transaction processing services comprising nationwide check clearing and remittance processing; trust, fiduciary, and agency services; credit card products; equipment finance; and investment and financial advisory services. Further, it engages in mutual fund and retail insurance sales, as well as provides mortgage banking services. As of December 31, 2018, the company operated approximately 300 branches under the First Tennessee Bank and Capital Bank brands. The company was founded in 1864 and is headquartered in Memphis, Tennessee.
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