Head to Head Analysis: Five Star Bancorp (NASDAQ:FSBC) & TriCo Bancshares (NASDAQ:TCBK)

TriCo Bancshares (NASDAQ:TCBK) and Five Star Bancorp (NASDAQ:FSBC) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, earnings, risk, profitability, analyst recommendations, institutional ownership and dividends.

Institutional & Insider Ownership

59.1% of TriCo Bancshares shares are held by institutional investors. Comparatively, 46.9% of Five Star Bancorp shares are held by institutional investors. 4.6% of TriCo Bancshares shares are held by insiders. Comparatively, 25.6% of Five Star Bancorp shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for TriCo Bancshares and Five Star Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TriCo Bancshares	0	2	4	0	2.67
Five Star Bancorp	0	1	2	0	2.67

TriCo Bancshares presently has a consensus price target of $49.80, suggesting a potential upside of 10.59%. Five Star Bancorp has a consensus price target of $32.33, suggesting a potential upside of 9.42%. Given TriCo Bancshares’ higher probable upside, equities analysts clearly believe TriCo Bancshares is more favorable than Five Star Bancorp.

Profitability

This table compares TriCo Bancshares and Five Star Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TriCo Bancshares	21.63%	9.93%	1.15%
Five Star Bancorp	22.24%	15.23%	1.23%

Risk and Volatility

TriCo Bancshares has a beta of 0.56, meaning that its share price is 44% less volatile than the S&P 500. Comparatively, Five Star Bancorp has a beta of 0.42, meaning that its share price is 58% less volatile than the S&P 500.

Valuation & Earnings

This table compares TriCo Bancshares and Five Star Bancorp’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TriCo Bancshares	$499.75 million	2.97	$117.39 million	$3.28	13.73
Five Star Bancorp	$115.51 million	5.45	$47.73 million	$2.63	11.24

TriCo Bancshares has higher revenue and earnings than Five Star Bancorp. Five Star Bancorp is trading at a lower price-to-earnings ratio than TriCo Bancshares, indicating that it is currently the more affordable of the two stocks.

Dividends

TriCo Bancshares pays an annual dividend of $1.32 per share and has a dividend yield of 2.9%. Five Star Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 2.7%. TriCo Bancshares pays out 40.2% of its earnings in the form of a dividend. Five Star Bancorp pays out 30.4% 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. TriCo Bancshares has increased its dividend for 12 consecutive years. TriCo Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

TriCo Bancshares beats Five Star Bancorp on 10 of the 16 factors compared between the two stocks.

About TriCo Bancshares

TriCo Bancshares operates as a bank holding company for Tri Counties Bank that provides commercial banking services to individual and corporate customers. The company accepts demand, savings, and time deposits. It also provides small business loans; real estate mortgage loans, such as residential and commercial loans; consumer loans; mortgage, auto, other vehicle, and personal loans; commercial loans, including agricultural loans; and real estate construction loans. In addition, the company offers treasury management services; credit and debit cards; and other customary banking services, including safe deposit boxes; and independent financial and broker-dealer services. Further, it provides checking, saving, and money market accounts, as well as individual retirement accounts; equipment financing; certificate of deposit account registry service; certificated of deposit; and IntraFi cash service. TriCo Bancshares was founded in 1975 and is headquartered in Chico, California.

About Five Star Bancorp

Five Star Bancorp operates as the bank holding company for Five Star Bank that provides a range of banking products and services to small and medium-sized businesses, professionals, and individuals in Northern California. It accepts various deposits, such as money market accounts, noninterest-bearing and interest checking accounts, savings accounts, term certificate accounts, and time deposits. The company also offers loan products, including commercial and residential real estate loans; commercial loans; commercial land loans; farmland loans; commercial and residential construction loans; and consumer and other loans, as well as operating lines of credit. In addition, it provides debit cards; and remote deposit capture, online and mobile banking, and direct deposit services. Five Star Bancorp was founded in 1999 and is headquartered in Rancho Cordova, California.