Bank OZK (NASDAQ:OZK) versus First Financial Bankshares (NASDAQ:FFIN) Head to Head Comparison

First Financial Bankshares (NASDAQ:FFIN) and Bank OZK (NASDAQ:OZK) are both mid-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Institutional & Insider Ownership

69.8% of First Financial Bankshares shares are held by institutional investors. Comparatively, 86.2% of Bank OZK shares are held by institutional investors. 4.2% of First Financial Bankshares shares are held by insiders. Comparatively, 6.7% of Bank OZK shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares First Financial Bankshares and Bank OZK’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Financial Bankshares	28.76%	13.43%	1.56%
Bank OZK	26.07%	14.15%	1.96%

Valuation and Earnings

This table compares First Financial Bankshares and Bank OZK”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Financial Bankshares	$636.07 million	9.61	$198.98 million	$1.45	29.50
Bank OZK	$2.25 billion	2.49	$690.78 million	$6.08	8.11

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

Analyst Recommendations

This is a breakdown of recent recommendations for First Financial Bankshares and Bank OZK, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Financial Bankshares	0	4	0	0	2.00
Bank OZK	2	6	1	0	1.89

First Financial Bankshares presently has a consensus target price of $37.75, indicating a potential downside of 11.74%. Bank OZK has a consensus target price of $48.50, indicating a potential downside of 1.68%. Given Bank OZK’s higher probable upside, analysts clearly believe Bank OZK is more favorable than First Financial Bankshares.

Dividends

First Financial Bankshares pays an annual dividend of $0.72 per share and has a dividend yield of 1.7%. Bank OZK pays an annual dividend of $1.64 per share and has a dividend yield of 3.3%. First Financial Bankshares pays out 49.7% of its earnings in the form of a dividend. Bank OZK pays out 27.0% 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. First Financial Bankshares has increased its dividend for 13 consecutive years and Bank OZK has increased its dividend for 28 consecutive years. Bank OZK is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

First Financial Bankshares has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500. Comparatively, Bank OZK has a beta of 1.16, meaning that its share price is 16% more volatile than the S&P 500.

Summary

Bank OZK beats First Financial Bankshares on 13 of the 17 factors compared between the two stocks.

About First Financial Bankshares

First Financial Bankshares, Inc., through its subsidiaries, provides commercial banking products and services in Texas. The company offers checking, savings and time deposits; automated teller machines, drive-in, and night deposit services; safe deposit facilities, remote deposit capture, internet banking, mobile banking, payroll cards, funds transfer, and performing other customary commercial banking services; securities brokerage services; and trust and wealth management services, including wealth management, estates administration, oil and gas management, testamentary trusts, revocable and irrevocable trusts, and agency accounts. It also provides commercial and industrial, municipal, agricultural, construction and development, farm, residential, and consumer auto and non-auto, as well as non-owner occupied and owner occupied commercial real estate loans. In addition, the company offers advisory and specialized services related to asset management, investing, purchasing, advertising, public relations, and technology services. First Financial Bankshares, Inc. was founded in 1890 and is headquartered in Abilene, Texas.

About Bank OZK

Bank OZK provides various retail and commercial banking services for individuals and businesses in the United States. The company offers deposit services, including non-interest bearing checking, interest bearing transaction, business sweep, savings, money market, individual retirement, and other accounts, as well as time and reciprocal deposits. It also provides trust and wealth services, such as personal trusts, custodial accounts, investment management accounts, and retirement accounts, as well as corporate trust services, including trustee, paying agent and registered transfer agent services, and other related services. In addition, the company offers treasury management services comprising automated clearing house, wire transfer, transaction reporting, wholesale lockbox, remote deposit capture, automated credit line transfer, reconciliation, positive pay, commercial card, and other services, as well as zero balance and investment sweep accounts. Further, it provides real estate, consumer, small business, indirect recreational vehicle and marine, equipment, agricultural, commercial and industrial, government guaranteed, lines of credit, homebuilder, and affordable housing loans; lender and structured, business aviation, and subscription financing services; and mortgage and other lending products. Additionally, the company offers ATMs; telephone, online, and mobile banking services; credit and debit cards; safe deposit boxes; and other products and services. The company was formerly known as Bank of the Ozarks and changed its name to Bank OZK in July 2018. Bank OZK was founded in 1903 and is headquartered in Little Rock, Arkansas.