Critical Analysis: Business First Bancshares (NASDAQ:BFST) vs. FVCBankcorp (NASDAQ:FVCB)

FVCBankcorp (NASDAQ:FVCB) and Business First Bancshares (NASDAQ:BFST) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, earnings, risk and analyst recommendations.

Institutional & Insider Ownership

43.6% of FVCBankcorp shares are owned by institutional investors. Comparatively, 47.3% of Business First Bancshares shares are owned by institutional investors. 10.9% of FVCBankcorp shares are owned by company insiders. Comparatively, 5.7% of Business First Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares FVCBankcorp and Business First Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FVCBankcorp	13.00%	7.72%	0.77%
Business First Bancshares	14.19%	11.88%	1.05%

Volatility and Risk

FVCBankcorp has a beta of 0.34, meaning that its share price is 66% less volatile than the S&P 500. Comparatively, Business First Bancshares has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for FVCBankcorp and Business First Bancshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FVCBankcorp	0	0	0	0	0.00
Business First Bancshares	0	0	3	0	3.00

Business First Bancshares has a consensus price target of $31.00, indicating a potential upside of 30.64%. Given Business First Bancshares’ stronger consensus rating and higher possible upside, analysts plainly believe Business First Bancshares is more favorable than FVCBankcorp.

Earnings and Valuation

This table compares FVCBankcorp and Business First Bancshares”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FVCBankcorp	$56.14 million	3.73	$15.06 million	$1.02	11.40
Business First Bancshares	$287.57 million	2.45	$65.11 million	$2.43	9.77

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

Summary

Business First Bancshares beats FVCBankcorp on 11 of the 14 factors compared between the two stocks.

About FVCBankcorp

FVCBankcorp, Inc. operates as the bank holding company for FVCbank that provides various banking products and services in Virginia. It offers deposit products, including interest and noninterest-bearing transaction accounts, savings accounts, money market accounts, and certificates of deposit. The company also provides commercial real estate loans; commercial construction loans; commercial loans for various business purposes, such as for working capital, equipment purchases, lines of credit, and government contract financing; small business administration loans; asset-based loans and accounts receivable financing; home equity loans; and consumer loans. In addition, it offers business and consumer credit cards; merchant services; business insurance products; and online banking, remote deposit, and mobile banking services. The company serves commercial businesses, nonprofit organizations, professional service entities, and their respective owners and employees located in the greater Washington, D.C., and Baltimore metropolitan areas. It operates branch offices in Arlington, Virginia; the independent city of Manassas, Virginia; Reston, Fairfax County, Virginia; Springfield, Fairfax County in Virginia; and Montgomery County and Baltimore in Maryland, and Washington, D.C. FVCBankcorp, Inc. was founded in 2007 and is headquartered in Fairfax, Virginia.

About Business First Bancshares

Business First Bancshares, Inc. operates as the bank holding company for b1BANK that provides various banking products and services in Louisiana and Texas. It offers various deposit products and services, including checking, demand, money market, time, and savings accounts; and certificates of deposits, remote deposit capture, and direct deposit services. The company also provides commercial and industrial loans, such as working capital, term, equipment financing, asset acquisition, expansion and development, borrowing base, and other loan products, as well as commercial lines of credit, accounts receivable factoring, agricultural financing, and letters of credit; construction and development loans; commercial real estate loans; residential real estate loans comprising first and second lien 1-4 family mortgage loans, and home equity lines of credit; and consumer loans, including secured and unsecured installment, and term loans. In addition, it offers wealth management products, including mutual funds, annuities, individual retirement accounts, and other financial products, as well as other fiduciary and private banking products and services. Further, the company provides a range of other financial services comprising debit and credit cards, treasury and cash management, merchant, automated clearing house, lock-box, receivables factoring, correspondent banking, and other treasury services, as well as employee and payroll benefits solutions; and drive-through banking facilities, automated teller machines, night depository, personalized checks, electronic funds transfer, domestic and foreign wire transfer, traveler's checks, vault, loan and deposit sweep accounts, online and mobile banking, e-statements, and bank-by-mail services. Business First Bancshares, Inc. was founded in 2006 and is headquartered in Baton Rouge, Louisiana.