Commerce Bancshares (NASDAQ:CBSH – Get Rating) and First National (NASDAQ:FXNC – Get Rating) are both financial companies, but which is the better stock? We will compare the two companies based on the strength of their risk, rewards, profitability, institutional ownership, dividends, analyst ratings, and valuation.

Score & Rating

This table compares the revenue, earnings per share, and valuation of Commerce Bancshares and First National.

Commerce Bancshares has higher revenues and profits than First National. First National is trading at a lower price-to-earnings multiple than Commerce Bancshares, suggesting it’s the cheaper of the two stocks at the moment.

dividends

Commerce Bancshares pays an annual dividend of $1.06 per share and has a dividend yield of 1.5%. First National pays an annual dividend of $0.56 per share and has a dividend yield of 2.7%. Commerce Bancshares pays out 24.6% of its profits in the form of a dividend. First National pays out 29.2% 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 years to come. Commerce Bancshares has increased its dividend for 1 year in a row and First National has increased its dividend for 7 years in a row. First National is clearly the better dividend stock because of its higher yield and longer track record of dividend growth.

profitability

This table compares the net margins, return on equity, and return on total assets of Commerce Bancshares and First National.

Risk & Volatility

Commerce Bancshares has a beta of 0.84, suggesting its stock price is 16% less volatile than the S&P 500. In comparison, First National has a beta of 0.52, suggesting its stock price is 48% less is more volatile than the S&P 500.

Institutional and Insider Ownership

Institutional investors own 64.0% of Commerce Bancshares shares. In comparison, 27.2% of First National’s stock is owned by institutional investors. Insiders own 3.2% of Commerce Bancshares’ shares. By comparison, 12.9% of First National’s stock is owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers, and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent Commerce Bancshares and First National recommendations as reported by MarketBeat.com.

Commerce Bancshares currently has a consensus price target of $69.47, suggesting a potential downside of 2.85%. First National has a consensus price target of $51.00, suggesting a potential upside of 142.86%. Given First National’s stronger consensus rating and more likely upside, analysts clearly believe First National is cheaper than Commerce Bancshares.

summary

Commerce Bancshares beats First National on 11 of the 16 factors comparing the two stocks.

About Commerce Bankshares (get rating)

Commerce Bancshares, Inc. acts as the bank holding company for Commerce Bank, which provides retail, mortgage lender, corporate, investment, trust and wealth management products and services to individuals and businesses throughout the United States. It operates through three segments: Consumer, Commercial and Assets. The consumer segment offers various banking products and services, including consumer deposits; consumer loans such as automobile, motorcycle, marine, tractor/trailer, recreational vehicle, fixed rate and revolving home equity loans and other consumer loans; financing of healthcare for patients; real estate loans; indirect and other consumer finance; personal mortgage banking; installment loans for consumers; and consumer debit and credit cards. The Merchant segment provides corporate lending, leasing, international, commercial and commercial bank cards, as well as securities custody and bond bookkeeping; and business products, government deposits and related commercial cash management services, and sells fixed income securities to correspondent banks, corporations, public institutions, municipalities and individuals. The Wealth segment offers traditional trust and estate planning, advisory and discretionary investment portfolio management and brokerage services, and private banking accounts. The company also offers private equity investing, securities broking, insurance broking, specialty lending and leasing services, and online and mobile banking services. It operates through a network of 287 locations in Missouri, Kansas, Illinois, Oklahoma and Colorado, as well as trade offices. Commerce Bancshares, Inc. was founded in 1865 and is headquartered in Kansas City, Missouri.

About FirstNational (get rating)

First National Corporation acts as the banking holding company for First Bank, which provides a variety of commercial banking services to small and medium-sized businesses, individuals, estates, local government agencies, and nonprofit organizations in Virginia. The company’s deposit products include checking, savings, money market and individual retirement accounts, as well as certificates of deposit and treasury management solutions. Its lending products include home loans, including home, real estate and development loans; Residential real estate loans for 1-4 families; and commercial real estate loans secured by commercial real estate, including multi-family residential buildings, office and retail buildings, hotels, industrial buildings and places of worship. The Company’s lending products also include commercial and industrial loans secured by business assets such as receivables, equipment and inventory; home equity loans; and secured and unsecured consumer loans, such as It also offers wealth management services including estate planning, investment management of assets, trustee under an agreement, trustee under a will and estate administration. In addition, the company offers property insurance and investment services; and holds other real estate and office locations, and provides internet and mobile banking, remote deposit collection, and other traditional banking services. It serves customers through 20 bank branches, a loan production office and customer service center, and a network of ATMs. The company was founded in 1907 and is headquartered in Strasburg, Virginia.

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