Head-To-Head Review: United Community Banks (NASDAQ:UCBI) versus Peoples Bancorp of North Carolina (NASDAQ:PEBK)

United Community Banks (NASDAQ:UCBI) and Peoples Bancorp of North Carolina (NASDAQ:PEBK) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Profitability

This table compares United Community Banks and Peoples Bancorp of North Carolina’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
United Community Banks 28.04% 12.10% 1.50%
Peoples Bancorp of North Carolina 20.89% 10.84% 1.22%

Insider & Institutional Ownership

90.6% of United Community Banks shares are held by institutional investors. Comparatively, 33.5% of Peoples Bancorp of North Carolina shares are held by institutional investors. 1.2% of United Community Banks shares are held by company insiders. Comparatively, 11.3% of Peoples Bancorp of North Carolina shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Risk and Volatility

United Community Banks has a beta of 1.28, suggesting that its share price is 28% more volatile than the S&P 500. Comparatively, Peoples Bancorp of North Carolina has a beta of 0.78, suggesting that its share price is 22% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for United Community Banks and Peoples Bancorp of North Carolina, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
United Community Banks 0 5 0 0 2.00
Peoples Bancorp of North Carolina 0 0 0 0 N/A

United Community Banks currently has a consensus target price of $32.25, suggesting a potential upside of 11.94%. Given United Community Banks’ higher possible upside, equities analysts plainly believe United Community Banks is more favorable than Peoples Bancorp of North Carolina.

Valuation and Earnings

This table compares United Community Banks and Peoples Bancorp of North Carolina’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
United Community Banks $657.42 million 3.46 $185.72 million $2.38 12.11
Peoples Bancorp of North Carolina $67.34 million 2.48 $14.07 million N/A N/A

United Community Banks has higher revenue and earnings than Peoples Bancorp of North Carolina.

Dividends

United Community Banks pays an annual dividend of $0.72 per share and has a dividend yield of 2.5%. Peoples Bancorp of North Carolina pays an annual dividend of $0.56 per share and has a dividend yield of 2.0%. United Community Banks pays out 30.3% of its earnings in the form of a dividend. United Community Banks has raised its dividend for 4 consecutive years and Peoples Bancorp of North Carolina has raised its dividend for 7 consecutive years.

Summary

United Community Banks beats Peoples Bancorp of North Carolina on 11 of the 14 factors compared between the two stocks.

United Community Banks Company Profile

United Community Banks, Inc. operates as the bank holding company for United Community Bank that provides retail and corporate banking services to individuals and businesses. It offers various deposit accounts, such as checking accounts, savings and time deposits accounts, NOW accounts, money market deposits, and certificates of deposit. The company also provides secured and unsecured loans that include commercial real estate, commercial and industrial, commercial construction, residential construction and mortgage, and indirect auto loans, as well as home equity lines of credits and fixed and adjustable-rate home mortgage loans. It also offers wire transfers, brokerage services, and other financial services, as well as risk management, payment processing, and merchant services. In addition, the company owns an insurance agency. As of December 31, 2017, it operated 156 locations in Georgia, North Carolina, South Carolina, and Tennessee. United Community Banks, Inc. was founded in 1950 and is based in Blairsville, Georgia.

Peoples Bancorp of North Carolina Company Profile

Peoples Bancorp of North Carolina, Inc. operates as a bank holding company for Peoples Bank that provides various banking products and services to individuals and small to medium-sized businesses. It offers various deposit products. The company's loan products comprise commercial real estate, commercial, construction and land development, single-family residential, residential mortgage, individual taxpayer identification number mortgage loans, as well as agricultural loans. It also provides investment counseling and non-deposit investment products, such as stocks, bonds, mutual funds, tax deferred annuities, and related brokerage services; and real estate appraisal and brokerage services. In addition, the company operates as a clearing-house for the provision of appraisal services for community banks; and acquires, manages, and disposes real property, other collateral, and other assets obtained in the ordinary course of collecting debts. As of December 31, 2018, it operated 20 banking offices located in Lincolnton, Newton, Denver, Catawba, Conover, Maiden, Claremont, Hiddenite, Hickory, Charlotte, Cornelius, Mooresville, Raleigh, and Cary in North Carolina. The company also operates loan production offices in Denver and Durham, North Carolina. Peoples Bancorp of North Carolina, Inc. was founded in 1912 and is headquartered in Newton, North Carolina.

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