Prime Meridian (OTCMKTS:PMHG) & Seacoast Banking Co. of Florida (NASDAQ:SBCF) Critical Analysis

Prime Meridian (OTCMKTS:PMHG) and Seacoast Banking Co. of Florida (NASDAQ:SBCF) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, risk, dividends, valuation and earnings.

Dividends

Prime Meridian pays an annual dividend of $0.25 per share and has a dividend yield of 1.0%. Seacoast Banking Co. of Florida pays an annual dividend of $0.72 per share and has a dividend yield of 2.8%. Prime Meridian pays out 10.0% of its earnings in the form of a dividend. Seacoast Banking Co. of Florida pays out 51.4% 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.

Profitability

This table compares Prime Meridian and Seacoast Banking Co. of Florida’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Prime Meridian	16.71%	9.58%	0.89%
Seacoast Banking Co. of Florida	14.84%	5.58%	0.79%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Prime Meridian and Seacoast Banking Co. of Florida, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Prime Meridian	0	0	0	0	N/A
Seacoast Banking Co. of Florida	0	2	2	0	2.50

Seacoast Banking Co. of Florida has a consensus target price of $29.88, indicating a potential upside of 14.16%. Given Seacoast Banking Co. of Florida’s higher probable upside, analysts plainly believe Seacoast Banking Co. of Florida is more favorable than Prime Meridian.

Volatility and Risk

Prime Meridian has a beta of 0.51, indicating that its stock price is 49% less volatile than the S&P 500. Comparatively, Seacoast Banking Co. of Florida has a beta of 1.08, indicating that its stock price is 8% more volatile than the S&P 500.

Institutional and Insider Ownership

11.8% of Prime Meridian shares are owned by institutional investors. Comparatively, 81.8% of Seacoast Banking Co. of Florida shares are owned by institutional investors. 25.9% of Prime Meridian shares are owned by insiders. Comparatively, 1.5% of Seacoast Banking Co. of Florida shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Prime Meridian and Seacoast Banking Co. of Florida”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Prime Meridian	$41.82 million	1.97	$8.71 million	$2.50	10.00
Seacoast Banking Co. of Florida	$768.13 million	2.89	$104.03 million	$1.40	18.69

Seacoast Banking Co. of Florida has higher revenue and earnings than Prime Meridian. Prime Meridian is trading at a lower price-to-earnings ratio than Seacoast Banking Co. of Florida, indicating that it is currently the more affordable of the two stocks.

Summary

Seacoast Banking Co. of Florida beats Prime Meridian on 9 of the 15 factors compared between the two stocks.

About Prime Meridian

Prime Meridian Holding Company operates as the bank holding company for Prime Meridian Bank that provides various consumer and commercial banking services to individuals and businesses. The company accepts various deposits, such as checking, money market, savings, term certificate of deposit, demand interest-bearing and noninterest-bearing, health savings, NOW, and escrow accounts, as well as retirement savings plans and time deposits. Its loan products include commercial real estate, residential real estate and home equity, small business administration, construction, equipment, and commercial loans; and consumer and other loans comprising financing of automobiles, boats, and recreational vehicles, as well as issues standby letters and business lines of credit. The company also offers debit and credit cards; mobile banking, remote and mobile deposit, Apple Pay, bank-to-bank transfer, and online banking services; and safe deposit, wire transfer, foreign exchange, direct deposits, notary, night depository, official checks, domestic collections, bank drafts, automated teller services, drive-in tellers, merchant card, and banking by mail services, as well as invests in securities. Prime Meridian Holding Company was founded in 2008 and is headquartered in Tallahassee, Florida.

About Seacoast Banking Co. of Florida

Seacoast Banking Corporation of Florida operates as the bank holding company for Seacoast National Bank that provides integrated financial services to retail and commercial customers in Florida. The company offers noninterest and interest-bearing demand deposit, money market, savings, and customer sweep accounts; time certificates of deposit; construction and land development, commercial and residential real estate, and commercial and financial loans; and consumer loans, including installment loans and revolving lines, as well as loans for automobiles, boats, and personal and family purposes. It also provides wealth management, mortgage, and insurance services through online and mobile banking solutions, as well as brokerage and annuity services. Seacoast Banking Corporation of Florida was founded in 1926 and is headquartered in Stuart, Florida.