South State Corporation (NASDAQ: SSB) and Bay Banks of Virginia (OTCMKTS:BAYK) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitability, analyst recommendations and dividends.

Dividends

South State Corporation pays an annual dividend of $1.32 per share and has a dividend yield of 1.5%. Bay Banks of Virginia pays an annual dividend of $0.16 per share and has a dividend yield of 1.5%. South State Corporation pays out 33.8% of its earnings in the form of a dividend. Bay Banks of Virginia pays out 76.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility & Risk

South State Corporation has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500. Comparatively, Bay Banks of Virginia has a beta of 0.19, indicating that its share price is 81% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for South State Corporation and Bay Banks of Virginia, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
South State Corporation 0 3 2 0 2.40
Bay Banks of Virginia 0 0 1 0 3.00

South State Corporation currently has a consensus target price of $95.67, suggesting a potential upside of 8.47%. Given South State Corporation’s higher probable upside, equities analysts clearly believe South State Corporation is more favorable than Bay Banks of Virginia.

Valuation & Earnings

This table compares South State Corporation and Bay Banks of Virginia’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
South State Corporation $463.49 million 5.57 $101.28 million $3.90 22.62
Bay Banks of Virginia $22.55 million 6.05 $2.53 million $0.21 49.29

South State Corporation has higher revenue and earnings than Bay Banks of Virginia. South State Corporation is trading at a lower price-to-earnings ratio than Bay Banks of Virginia, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares South State Corporation and Bay Banks of Virginia’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
South State Corporation 20.48% 8.85% 1.24%
Bay Banks of Virginia 5.25% 3.17% 0.32%

Institutional & Insider Ownership

69.1% of South State Corporation shares are held by institutional investors. Comparatively, 6.8% of Bay Banks of Virginia shares are held by institutional investors. 2.8% of South State Corporation shares are held by insiders. Comparatively, 7.9% of Bay Banks of Virginia shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

South State Corporation beats Bay Banks of Virginia on 11 of the 16 factors compared between the two stocks.

South State Corporation Company Profile

South State Corporation (NASDAQ: SSB) is the largest bank holding company headquartered in South Carolina. Founded in 1933, the company’s primary subsidiary, South State Bank, has been serving the financial needs of its local communities in 19 South Carolina counties, 12 Georgia counties and 4 North Carolina counties for over 80 years. The bank also operates Minis & Co., Inc. and First Southeast 401K Fiduciaries, Inc., both registered investment advisors; and First Southeast Investor Services, Inc., a limited purpose broker-dealer. South State Corporation has assets of approximately $8.0 billion and its stock is traded under the symbol SSB on the NASDAQ Global Select Market. More information can be found at www.SouthStateBank.com.

Bay Banks of Virginia Company Profile

Bay Banks of Virginia, Inc. is a bank holding company that conducts its operations through its subsidiaries, Virginia Commonwealth Bank and Bay Trust Company. The Bank is a state-chartered bank and a member of the Federal Reserve System. It serves businesses, professionals and consumers with a range of financial services, including retail and commercial banking, investment services and mortgage banking. Its products include cash management accounts, individual retirement accounts, commercial and industrial loans, residential mortgages, commercial mortgages, home equity loans, consumer installment loans, investment accounts, insurance, credit cards and telephone banking. Its deposits include non-interest bearing demand deposits, interest bearing deposits and time deposits. The Trust Company provides management services for personal and corporate trusts, including estate planning, estate settlement and trust administration.

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