Stock Yards Bancorp (NASDAQ:SYBT) and Kentucky Bancshares (OTCMKTS:KTYB) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, dividends, earnings and risk.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Stock Yards Bancorp and Kentucky Bancshares, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Stock Yards Bancorp 0 0 2 0 3.00
Kentucky Bancshares 0 0 0 0 N/A

Stock Yards Bancorp presently has a consensus price target of $42.00, suggesting a potential upside of 6.57%. Given Stock Yards Bancorp’s higher probable upside, equities analysts plainly believe Stock Yards Bancorp is more favorable than Kentucky Bancshares.

Risk & Volatility

Stock Yards Bancorp has a beta of 0.75, meaning that its stock price is 25% less volatile than the S&P 500. Comparatively, Kentucky Bancshares has a beta of 0.55, meaning that its stock price is 45% less volatile than the S&P 500.

Profitability

This table compares Stock Yards Bancorp and Kentucky Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Stock Yards Bancorp 31.69% 15.90% 1.76%
Kentucky Bancshares 20.06% 10.28% 1.09%

Valuation & Earnings

This table compares Stock Yards Bancorp and Kentucky Bancshares’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Stock Yards Bancorp $197.55 million 4.52 $66.07 million $2.89 13.64
Kentucky Bancshares $59.77 million 1.67 $13.15 million N/A N/A

Stock Yards Bancorp has higher revenue and earnings than Kentucky Bancshares.

Dividends

Stock Yards Bancorp pays an annual dividend of $1.08 per share and has a dividend yield of 2.7%. Kentucky Bancshares pays an annual dividend of $0.72 per share and has a dividend yield of 4.3%. Stock Yards Bancorp pays out 37.4% of its earnings in the form of a dividend. Stock Yards Bancorp has raised its dividend for 8 consecutive years.

Insider and Institutional Ownership

52.3% of Stock Yards Bancorp shares are owned by institutional investors. Comparatively, 2.8% of Kentucky Bancshares shares are owned by institutional investors. 6.6% of Stock Yards Bancorp shares are owned by company insiders. Comparatively, 8.7% of Kentucky Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Stock Yards Bancorp beats Kentucky Bancshares on 12 of the 15 factors compared between the two stocks.

Stock Yards Bancorp Company Profile

Stock Yards Bancorp, Inc. operates as the holding company for Stock Yards Bank & Trust Company that provides commercial and personal banking services in Louisville, Indianapolis, and Cincinnati. Its deposit products include demand deposits, savings deposits, money market deposits, and time deposits. The company's loan portfolio comprises commercial and industrial, construction and development, undeveloped land, real estate mortgage, and consumer loans; and originates and sells single-family residential mortgages. In addition, it offers securities brokerage services through an arrangement with a third party broker-dealer; and investment management, trust, employee benefit plan, estate administration, and financial planning services. As of December 31, 2018, the company had 38 full service banking locations, including 28 in the Louisville metropolitan statistical area (MSA), 5 in Indianapolis MSA, and 5 in Cincinnati MSA. Stock Yards Bancorp, Inc. was founded in 1904 and is headquartered in Louisville, Kentucky.

Kentucky Bancshares Company Profile

Kentucky Bancshares, Inc. operates as a bank holding company for Kentucky Bank that provides commercial and consumer banking products and services. It accepts various deposit products, including checking, savings, and money market accounts; and certificates of deposit, safe deposits, interest and noninterest bearing deposits, and time deposits. The company also offers commercial, agricultural, and real estate loans to small-to-medium-sized industrial, service, and agricultural businesses; and residential mortgages, installments, and other loans to individual and other non-commercial customers. In addition, it provides credit cards and other consumer-oriented financial services; brokerage services, annuities, life and long term care insurance, personal trust, and agency services; and Internet banking services, such as bill payment. The company has operations in Bourbon, Clark, Elliott, Fayette, Harrison, Jessamine, Madison, Rowan, Scott, Woodford, and other counties in Kentucky. Kentucky Bancshares, Inc. was founded in 1851 and is headquartered in Paris, Kentucky.

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