Critical Comparison: Southside Bancshares (NASDAQ:SBSI) vs. Atlantic Union Bankshares (NASDAQ:AUB)

Southside Bancshares (NASDAQ:SBSI) and Atlantic Union Bankshares (NASDAQ:AUB) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, dividends, valuation and analyst recommendations.

Dividends

Southside Bancshares pays an annual dividend of $1.44 per share and has a dividend yield of 4.4%. Atlantic Union Bankshares pays an annual dividend of $1.28 per share and has a dividend yield of 3.4%. Southside Bancshares pays out 53.5% of its earnings in the form of a dividend. Atlantic Union Bankshares pays out 47.1% 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. Southside Bancshares has increased its dividend for 30 consecutive years and Atlantic Union Bankshares has increased its dividend for 13 consecutive years. Southside Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

55.7% of Southside Bancshares shares are owned by institutional investors. Comparatively, 78.6% of Atlantic Union Bankshares shares are owned by institutional investors. 5.9% of Southside Bancshares shares are owned by company insiders. Comparatively, 0.9% of Atlantic Union Bankshares shares are owned by company 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.

Valuation & Earnings

This table compares Southside Bancshares and Atlantic Union Bankshares’ revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Southside Bancshares	$395.58 million	2.52	$86.69 million	$2.69	12.25
Atlantic Union Bankshares	$1.05 billion	3.23	$201.82 million	$2.72	13.84

Atlantic Union Bankshares has higher revenue and earnings than Southside Bancshares. Southside Bancshares is trading at a lower price-to-earnings ratio than Atlantic Union Bankshares, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Southside Bancshares and Atlantic Union Bankshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southside Bancshares	0	1	0	0	2.00
Atlantic Union Bankshares	0	1	4	0	2.80

Southside Bancshares currently has a consensus price target of $37.00, indicating a potential upside of 12.26%. Atlantic Union Bankshares has a consensus price target of $40.20, indicating a potential upside of 6.80%. Given Southside Bancshares’ higher possible upside, analysts clearly believe Southside Bancshares is more favorable than Atlantic Union Bankshares.

Risk and Volatility

Southside Bancshares has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500. Comparatively, Atlantic Union Bankshares has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500.

Profitability

This table compares Southside Bancshares and Atlantic Union Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Southside Bancshares	18.90%	10.64%	1.00%
Atlantic Union Bankshares	15.53%	8.95%	1.07%

Summary

Atlantic Union Bankshares beats Southside Bancshares on 11 of the 17 factors compared between the two stocks.

About Southside Bancshares

Southside Bancshares, Inc. operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations. Its deposit products include savings, money market, and interest and noninterest bearing checking accounts, as well as certificates of deposits. The company's loan portfolio comprises consumer loans that include 1-4 family residential loans, home equity loans, home improvement loans, automobile loans, and other consumer related loans; commercial loans, such as short-term working capital loans for inventory and accounts receivable, short and medium-term loans for equipment or other business capital expansion, commercial real estate loans, and municipal loans; and construction loans for 1-4 family residential and commercial real estate. It also offers wealth management and trust services consisting of investment management, administration of irrevocable, revocable, and testamentary trusts, estate administration, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. In addition, the company provides retirement and employee benefit accounts, including plans and profit sharing plans; and telephone, internet, and mobile banking services. The company offers various banking services through branches, drive-thru facilities, automated teller machines, and interactive teller machines. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.

About Atlantic Union Bankshares

Atlantic Union Bankshares Corporation operates as the bank holding company for Atlantic Union Bank that provides banking and related financial products and services to consumers and businesses in the United States. It operates in two segments, Wholesale Banking and Consumer Banking. The company accepts various deposit products, including checking, savings, time deposit, and money market accounts; certificates of deposit; and other depository services. It also provides loans for commercial, industrial, residential mortgage, and consumer purposes, as well as debit and credit cards. In addition, it provides treasury management and capital market, wealth management, private banking, trust, financial and retirement planning, brokerage, investment management, equipment finance, mortgage banking, and insurance products and services. The company offers products and services through full-service branches and ATMs, as well as through its mobile and internet banking. The company was formerly known as Union Bankshares Corporation and changed its name to Atlantic Union Bankshares Corporation in May 2019. Atlantic Union Bankshares Corporation was founded in 1902 and is headquartered in Glen Allen, Virginia.