Critical Survey: BNP Paribas (OTCMKTS:BNPQY) versus Southside Bancshares (NYSE:SBSI)

Southside Bancshares (NYSE:SBSI) and BNP Paribas (OTCMKTS:BNPQY) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, earnings, dividends and risk.

Analyst Recommendations

This is a summary of current ratings for Southside Bancshares and BNP Paribas, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southside Bancshares	0	6	0	0	2.00
BNP Paribas	0	4	3	1	2.62

Southside Bancshares currently has a consensus price target of $34.75, suggesting a potential upside of 15.27%. Given Southside Bancshares’ higher probable upside, equities research analysts clearly believe Southside Bancshares is more favorable than BNP Paribas.

Earnings & Valuation

This table compares Southside Bancshares and BNP Paribas”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Southside Bancshares	$419.03 million	2.14	$69.18 million	$2.54	11.87
BNP Paribas	$57.94 billion	1.89	$13.83 billion	$6.75	7.38

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

Profitability

This table compares Southside Bancshares and BNP Paribas’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Southside Bancshares	16.70%	11.16%	1.11%
BNP Paribas	25.22%	10.19%	0.47%

Risk & Volatility

Southside Bancshares has a beta of 0.61, suggesting that its share price is 39% less volatile than the S&P 500. Comparatively, BNP Paribas has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500.

Insider & Institutional Ownership

55.7% of Southside Bancshares shares are owned by institutional investors. Comparatively, 1.2% of BNP Paribas shares are owned by institutional investors. 5.1% of Southside Bancshares shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Southside Bancshares pays an annual dividend of $1.48 per share and has a dividend yield of 4.9%. BNP Paribas pays an annual dividend of $2.70 per share and has a dividend yield of 5.4%. Southside Bancshares pays out 58.3% of its earnings in the form of a dividend. BNP Paribas pays out 40.0% 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. Southside Bancshares has raised its dividend for 30 consecutive years. BNP Paribas is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

BNP Paribas beats Southside Bancshares on 10 of the 18 factors compared between the two stocks.

About Southside Bancshares

Southside Bancshares, Inc. operates as the bank holding company for Southside Bank that provides a range of financial services to individuals, businesses, municipal entities, and nonprofit organizations. Its deposit products include savings, money market, and interest and noninterest bearing checking accounts, as well as certificates of deposit. The company’s loan portfolio comprises consumer loans that include 1-4 family residential loans, home equity loans, home improvement loans, automobile loans, and other consumer related loans; commercial loans, such as short-term working capital loans for inventory and accounts receivable, short and medium-term loans for equipment or other business capital expansion, commercial real estate loans, and municipal loans; and construction loans for 1-4 family residential and commercial real estate. It also offers wealth management and trust services consisting of investment management, administration, revocable and testamentary trusts, and custodian services for individuals, partnerships, and corporations; safe deposit services; and brokerage services. As of December 31, 2021, the company operated through 56 banking facilities and 73 ATMs/ITMs. Southside Bancshares, Inc. was founded in 1960 and is headquartered in Tyler, Texas.

About BNP Paribas

BNP Paribas SA provides various banking and financial products and services in Europe, the Middle East, Africa, the Americas, and the Asia Pacific. It operates through three divisions: Corporate & Institutional Banking; Commercial, Personal Banking & Services; and Investment & Protection Services. The Corporate & Institutional Banking division offers capital market, securities, investment banking, financing, risk management, cash management, and financial advisory services for corporate clients and institutional investors. The Commercial, Personal Banking & Services division provides financing and equipment leasing services, mobility, and digital banking services, as well as current accounts, savings products, bancassurance, insurance products and services, and consumer loans. The Investment & Protection Services division provides protection, savings, investment, and real estate services to support individuals, professionals, corporate clients, and institutions. The company was formerly known as Banque Nationale de Paris and changed its name to BNP Paribas SA in May 2000. BNP Paribas SA was founded in 1822 and is headquartered in Paris, France.