Reviewing Colony Bankcorp (NASDAQ:CBAN) and First Community Bankshares (NASDAQ:FCBC)

Colony Bankcorp (NASDAQ:CBAN) and First Community Bankshares (NASDAQ:FCBC) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Profitability

This table compares Colony Bankcorp and First Community Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Colony Bankcorp	13.03%	9.22%	0.76%
First Community Bankshares	28.30%	11.33%	1.74%

Dividends

Colony Bankcorp pays an annual dividend of $0.45 per share and has a dividend yield of 2.9%. First Community Bankshares pays an annual dividend of $1.16 per share and has a dividend yield of 2.6%. Colony Bankcorp pays out 36.0% of its earnings in the form of a dividend. First Community Bankshares pays out 42.8% 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 Community Bankshares has increased its dividend for 12 consecutive years. Colony Bankcorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

50.4% of Colony Bankcorp shares are held by institutional investors. Comparatively, 35.0% of First Community Bankshares shares are held by institutional investors. 6.6% of Colony Bankcorp shares are held by insiders. Comparatively, 3.7% of First Community Bankshares shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Colony Bankcorp has a beta of 0.58, suggesting that its share price is 42% less volatile than the S&P 500. Comparatively, First Community Bankshares has a beta of 0.53, suggesting that its share price is 47% less volatile than the S&P 500.

Valuation & Earnings

This table compares Colony Bankcorp and First Community Bankshares’ revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Colony Bankcorp	$160.55 million	1.69	$21.75 million	$1.25	12.35
First Community Bankshares	$174.62 million	4.67	$48.02 million	$2.71	16.40

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

Analyst Ratings

This is a summary of recent recommendations for Colony Bankcorp and First Community Bankshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Colony Bankcorp	0	0	0	0	N/A
First Community Bankshares	1	1	0	0	1.50

First Community Bankshares has a consensus target price of $35.50, suggesting a potential downside of 20.13%. Given First Community Bankshares’ higher probable upside, analysts clearly believe First Community Bankshares is more favorable than Colony Bankcorp.

Summary

First Community Bankshares beats Colony Bankcorp on 10 of the 15 factors compared between the two stocks.

About Colony Bankcorp

Colony Bankcorp, Inc. operates as the bank holding company for Colony Bank that provides various banking products and services to commercial and consumer customers. The company offers deposit products, including demand, savings, and time deposits. It also provides loans to small and medium-sized businesses; residential and commercial construction, and land development loans; commercial real estate loans; commercial loans; agri-business and production loans; residential mortgage loans; home equity loans; and consumer loans. In addition, the company offers internet banking services, electronic bill payment services, safe deposit box rentals, telephone banking, credit and debit card services, and remote depository products, as well as access to a network of ATMs. The company was founded in 1975 and is headquartered in Fitzgerald, Georgia.

About First Community Bankshares

First Community Bankshares, Inc. operates as the financial holding company for First Community Bank that provides various banking products and services. It offers demand deposit accounts, savings and money market accounts, certificates of deposit, and individual retirement plans; and commercial, consumer real estate, and consumer and other loans. The company also provides trust management, estate administration, and investment advisory services; and investment management services. It serves individuals and businesses across various industries, such as education, government, and health services; coal mining and gas extraction; retail trade; construction; manufacturing; tourism; and transportation. The company operates through branches in West Virginia, Virginia, North Carolina, and Tennessee. Community Bankshares, Inc. was founded in 1874 and is headquartered in Bluefield, Virginia.