Analyzing Truxton (OTCMKTS:TRUX) & Enterprise Financial Services (NASDAQ:EFSC)

Enterprise Financial Services (NASDAQ:EFSC) and Truxton (OTCMKTS:TRUX) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, profitability, institutional ownership, analyst recommendations, risk, earnings and dividends.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Enterprise Financial Services and Truxton, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Enterprise Financial Services	0	0	3	0	3.00
Truxton	0	0	0	0	N/A

Enterprise Financial Services currently has a consensus price target of $50.67, indicating a potential upside of 0.45%. Given Enterprise Financial Services’ higher probable upside, research analysts clearly believe Enterprise Financial Services is more favorable than Truxton.

Earnings and Valuation

This table compares Enterprise Financial Services and Truxton”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Enterprise Financial Services	$531.97 million	3.55	$194.06 million	$4.67	10.80
Truxton	$67.30 million	3.07	$17.54 million	$6.04	11.75

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

Insider and Institutional Ownership

72.2% of Enterprise Financial Services shares are held by institutional investors. Comparatively, 0.4% of Truxton shares are held by institutional investors. 2.3% of Enterprise Financial Services 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.

Risk & Volatility

Enterprise Financial Services has a beta of 0.98, suggesting that its share price is 2% less volatile than the S&P 500. Comparatively, Truxton has a beta of 0.65, suggesting that its share price is 35% less volatile than the S&P 500.

Dividends

Enterprise Financial Services pays an annual dividend of $1.08 per share and has a dividend yield of 2.1%. Truxton pays an annual dividend of $1.72 per share and has a dividend yield of 2.4%. Enterprise Financial Services pays out 23.1% of its earnings in the form of a dividend. Truxton pays out 28.5% 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Enterprise Financial Services	19.61%	10.95%	1.24%
Truxton	23.95%	N/A	N/A

Summary

Enterprise Financial Services beats Truxton on 11 of the 15 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 Truxton

Truxton Corporation, through its subsidiaries, provides various banking, investment management, and trust administration services to individuals, businesses, and charitable institutions in the United States. The company offers deposit products, including demand, money market accounts, and certificates of deposit. It also provides lending products, such as residential and commercial real estate mortgages, commercial loans, construction and land development loans, commercial and industrial loans, operating lines of credit, and loans to individual. In addition, the company offers strategic and capital advisory services, business banking, and treasury management services; and insurance products. The company was formerly known as NBT Holdings Inc. and changed its name to Truxton Corporation in May 2013. Truxton Corporation was founded in 2004 and is based in Nashville, Tennessee.