Critical Contrast: United Community Banks (UCB) and Its Competitors

United Community Banks (NYSE:UCB) is one of 87 publicly-traded companies in the “BANKS – SOUTHEAST” industry, but how does it contrast to its peers? We will compare United Community Banks to related companies based on the strength of its valuation, earnings, profitability, dividends, institutional ownership, risk and analyst recommendations.

Insider and Institutional Ownership

82.3% of United Community Banks shares are held by institutional investors. Comparatively, 50.4% of shares of all “BANKS – SOUTHEAST” companies are held by institutional investors. 0.4% of United Community Banks shares are held by insiders. Comparatively, 12.5% of shares of all “BANKS – SOUTHEAST” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares United Community Banks and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Community Banks	17.93%	8.91%	1.09%
United Community Banks Competitors	16.68%	10.30%	1.06%

Earnings & Valuation

This table compares United Community Banks and its peers revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
United Community Banks	$1.50 billion	$252.40 million	13.98
United Community Banks Competitors	$875.29 million	$154.64 million	14.18

United Community Banks has higher revenue and earnings than its peers. United Community Banks is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Dividends

United Community Banks pays an annual dividend of $0.96 per share and has a dividend yield of 3.1%. United Community Banks pays out 43.6% of its earnings in the form of a dividend. As a group, “BANKS – SOUTHEAST” companies pay a dividend yield of 1.6% and pay out 19.2% of their earnings in the form of a dividend.

Volatility & Risk

United Community Banks has a beta of 0.78, meaning that its stock price is 22% less volatile than the S&P 500. Comparatively, United Community Banks’ peers have a beta of 0.59, meaning that their average stock price is 41% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for United Community Banks and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Community Banks	0	1	0	0	2.00
United Community Banks Competitors	430	2218	2008	95	2.37

As a group, “BANKS – SOUTHEAST” companies have a potential upside of 13.47%. Given United Community Banks’ peers stronger consensus rating and higher possible upside, analysts plainly believe United Community Banks has less favorable growth aspects than its peers.

Summary

United Community Banks peers beat United Community Banks on 8 of the 15 factors compared.

About United Community Banks

United Community Banks, Inc. operates as the financial holding company for United Community Bank that provides financial products and services to commercial, retail, government, education, energy, health care, and real estate sectors. The company accepts various deposit products, including checking, savings, money market, and other deposit accounts. It also offers lending services, including real estate, consumer, and commercial loans, to individuals, small businesses, mid-sized commercial businesses, and non-profit organizations, as well as secured and unsecured, and mortgage loans. In addition, the company originate loans partially guaranteed by the SBA and USDA loan programs. Further, it provides wealth management services comprising financial planning, customized portfolio management, and investment advice; trust services to manage fiduciary assets; non-deposit investment products; and insurance products, including life insurance, long-term care insurance, and tax-deferred annuities, as well as invests in residential and commercial mortgage-backed securities, asset-backed securities, the U.S. treasury, the U.S. agency, and municipal obligations. Additionally, the company offers reinsurance on a property insurance contract; insurance agency services; brokerage services; and payment processing, merchant, wire transfer, private banking, and other related financial services. It operates through a network of 171 branches in Florida, Georgia, North Carolina, South Carolina, and Tennessee. United Community Banks, Inc. was founded in 1950 and is headquartered in Blairsville, Georgia.