Head to Head Comparison: First Mid Bancshares (NASDAQ:FMBH) & S&T Bancorp (NASDAQ:STBA)

First Mid Bancshares (NASDAQ:FMBH) and S&T Bancorp (NASDAQ:STBA) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, earnings, analyst recommendations, risk, profitability, dividends and valuation.

Volatility and Risk

First Mid Bancshares has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500. Comparatively, S&T Bancorp has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings for First Mid Bancshares and S&T Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Mid Bancshares	0	0	5	0	3.00
S&T Bancorp	0	1	0	0	2.00

First Mid Bancshares presently has a consensus target price of $36.60, indicating a potential downside of 7.37%. S&T Bancorp has a consensus target price of $41.00, indicating a potential downside of 4.18%. Given S&T Bancorp’s higher possible upside, analysts clearly believe S&T Bancorp is more favorable than First Mid Bancshares.

Valuation & Earnings

This table compares First Mid Bancshares and S&T Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Mid Bancshares	$306.31 million	3.06	$68.93 million	$3.10	12.66
S&T Bancorp	$395.94 million	4.15	$144.78 million	$3.53	12.18

S&T Bancorp has higher revenue and earnings than First Mid Bancshares. S&T Bancorp is trading at a lower price-to-earnings ratio than First Mid Bancshares, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

47.6% of First Mid Bancshares shares are held by institutional investors. Comparatively, 65.2% of S&T Bancorp shares are held by institutional investors. 7.7% of First Mid Bancshares shares are held by insiders. Comparatively, 1.4% of S&T Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Dividends

First Mid Bancshares pays an annual dividend of $0.96 per share and has a dividend yield of 2.4%. S&T Bancorp pays an annual dividend of $1.32 per share and has a dividend yield of 3.1%. First Mid Bancshares pays out 31.0% of its earnings in the form of a dividend. S&T Bancorp pays out 37.4% 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. S&T Bancorp has raised its dividend for 11 consecutive years. S&T Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares First Mid Bancshares and S&T Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Mid Bancshares	16.75%	10.43%	1.07%
S&T Bancorp	24.20%	10.63%	1.43%

Summary

S&T Bancorp beats First Mid Bancshares on 11 of the 17 factors compared between the two stocks.

About First Mid Bancshares

First Mid Bancshares, Inc., a financial holding company, provides community banking products and services to commercial, retail, and agricultural customers in the United States. It accepts various deposit products, such as demand deposits, savings accounts, money market deposits, and time deposits. The company's loan products include commercial real estate, commercial and industrial, agricultural and agricultural real estate, residential real estate, and consumer loans, as well as construction and land development, 1-4 family residential properties, and multifamily residential properties loans; and other loans comprising loans to municipalities to support community projects, such as infrastructure improvements or equipment purchases. It also offers wealth management services, which include estate planning, investment, and farm management and brokerage services for individuals; employee benefit services for businesses; and farm management and brokerage services. In addition, the company provides property and casualty, senior insurance products, and group medical insurance for businesses; and personal lines insurance to individuals. The company was formerly known as First Mid-Illinois Bancshares, Inc. and changed its name to First Mid Bancshares, Inc. in April 2019. First Mid Bancshares, Inc. was founded in 1865 and is headquartered in Mattoon, Illinois.

About S&T Bancorp

S&T Bancorp, Inc. operates as the bank holding company for S&T Bank that engages in the provision of retail and commercial banking products and services. The company operates through six segments: Commercial Real Estate, Commercial and Industrial, Commercial Construction, Business Banking, Consumer Real Estate, and Other Consumer. The company accepts time and demand deposits; and offers commercial and consumer loans, cash management services, and brokerage and trust services, as well as acts as guardian and custodian of employee benefits. It also manages private investment accounts for individuals and institutions. In addition, the company distributes life insurance and long-term disability income insurance products, as well as offers title insurance agency services to commercial customers; and acts as a reinsurer of credit life, accident, and health insurance policies. S&T Bancorp, Inc. was founded in 1902 and is headquartered in Indiana, Pennsylvania.