Head-To-Head Comparison: Banner (NASDAQ:BANR) and HBT Financial (NASDAQ:HBT)

Banner (NASDAQ:BANR) and HBT Financial (NASDAQ:HBT) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, valuation, dividends and analyst recommendations.

Dividends

Banner pays an annual dividend of $1.92 per share and has a dividend yield of 2.8%. HBT Financial pays an annual dividend of $0.84 per share and has a dividend yield of 3.3%. Banner pays out 39.3% of its earnings in the form of a dividend. HBT Financial pays out 37.2% 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. HBT Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Banner and HBT Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banner	$832.99 million	2.83	$168.90 million	$4.88	14.03
HBT Financial	$287.27 million	2.76	$71.78 million	$2.26	11.12

Banner has higher revenue and earnings than HBT Financial. HBT Financial is trading at a lower price-to-earnings ratio than Banner, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Banner and HBT Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banner	20.28%	10.03%	1.09%
HBT Financial	24.99%	14.57%	1.50%

Analyst Ratings

This is a breakdown of recent ratings and price targets for Banner and HBT Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banner	0	3	3	0	2.50
HBT Financial	1	2	2	0	2.20

Banner currently has a consensus target price of $74.20, indicating a potential upside of 8.39%. HBT Financial has a consensus target price of $24.80, indicating a potential downside of 1.33%. Given Banner’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Banner is more favorable than HBT Financial.

Insider and Institutional Ownership

87.3% of Banner shares are held by institutional investors. Comparatively, 78.6% of HBT Financial shares are held by institutional investors. 1.6% of Banner shares are held by company insiders. Comparatively, 59.8% of HBT Financial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Banner has a beta of 1.09, meaning that its stock price is 9% more volatile than the S&P 500. Comparatively, HBT Financial has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500.

Summary

Banner beats HBT Financial on 10 of the 16 factors compared between the two stocks.

About Banner

Banner Corporation operates as the bank holding company for Banner Bank that engages in the provision of commercial banking and financial products and services to individuals, businesses, and public sector entities in the United States. It accepts various deposit instruments, including interest-bearing and non-interest-bearing checking accounts, money market deposit accounts, regular savings accounts, and certificates of deposit, as well as treasury management services and retirement savings plans. The company also provides commercial real estate loans, including owner-occupied, investment properties, and multifamily residential real estate loans; construction, land, and land development loans; one- to four-family residential real estate lending; commercial business loans; agricultural loans; consumer and other loans, such as home equity lines of credit, automobile, and boat and recreational vehicle loans, as well as loans secured by deposit accounts; and small business administration loans. In addition, it provides electronic and digital banking services comprising debit cards and ATMs, internet banking, remote deposit, and mobile banking services. The company was founded in 1890 and is based in Walla Walla, Washington.

About HBT Financial

HBT Financial, Inc. operates as the bank holding company for Heartland Bank and Trust Company that provides business, commercial, and retail banking products and services to individuals, businesses, and municipal entities in Central and Northeastern Illinois, and Eastern Iowa. The company's deposits accounts consist of noninterest-bearing demand deposits, interest-bearing transaction accounts, money market accounts, savings accounts, certificates of deposits, health savings accounts, and individual retirement accounts. Its loan offering comprises owner and non-owner occupied commercial real estate; construction and land development and multi-family; commercial and industrial; agricultural and farmland; and one-to-four family residential loans, as well as municipal, consumer, and other loans. The company also offers wealth management services, including financial planning to consumers, trusts, and estates; trustee and custodial; investment management; corporate retirement plan consulting and administration; and retail brokerage services. In addition, it provides farmland management, and farmland sales and services; commercial checking accounts; and treasury management services, as well as originates and sells residential mortgage loans. Further, the company offers digital banking services, such as online and mobile banking, and digital payment services, as well as personal financial management tools. The company was formerly known as Heartland Bancorp, Inc. and changed its name to HBT Financial, Inc. in September 2019. HBT Financial, Inc. was founded in 1920 and is headquartered in Bloomington, Illinois.