Critical Analysis: Virginia National Bankshares (NASDAQ:VABK) versus Trustmark (NASDAQ:TRMK)

Virginia National Bankshares (NASDAQ:VABK) and Trustmark (NASDAQ:TRMK) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, institutional ownership, risk, earnings, profitability, valuation and analyst recommendations.

Volatility & Risk

Virginia National Bankshares has a beta of 0.4, suggesting that its stock price is 60% less volatile than the S&P 500. Comparatively, Trustmark has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500.

Profitability

This table compares Virginia National Bankshares and Trustmark’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Virginia National Bankshares	21.09%	11.73%	1.07%
Trustmark	13.82%	10.04%	0.88%

Valuation and Earnings

This table compares Virginia National Bankshares and Trustmark’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Virginia National Bankshares	$55.12 million	2.97	$19.26 million	$3.18	9.59
Trustmark	$1.10 billion	1.60	$165.49 million	$2.57	11.20

Trustmark has higher revenue and earnings than Virginia National Bankshares. Virginia National Bankshares is trading at a lower price-to-earnings ratio than Trustmark, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Virginia National Bankshares and Trustmark, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Virginia National Bankshares	0	0	0	0	N/A
Trustmark	0	3	1	0	2.25

Trustmark has a consensus price target of $32.75, indicating a potential upside of 13.75%. Given Trustmark’s higher possible upside, analysts clearly believe Trustmark is more favorable than Virginia National Bankshares.

Institutional & Insider Ownership

37.4% of Virginia National Bankshares shares are owned by institutional investors. Comparatively, 67.6% of Trustmark shares are owned by institutional investors. 12.6% of Virginia National Bankshares shares are owned by company insiders. Comparatively, 1.5% of Trustmark shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Virginia National Bankshares pays an annual dividend of $1.32 per share and has a dividend yield of 4.3%. Trustmark pays an annual dividend of $0.92 per share and has a dividend yield of 3.2%. Virginia National Bankshares pays out 41.5% of its earnings in the form of a dividend. Trustmark pays out 35.8% 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.

Summary

Trustmark beats Virginia National Bankshares on 8 of the 15 factors compared between the two stocks.

About Virginia National Bankshares

Virginia National Bankshares Corporation operates as the holding company for Virginia National Bank that provides a range of commercial and retail banking services. The company operates through Bank, Sturman Wealth Advisors, VNB Trust and Estate Services, and Masonry Capital segments. It provides checking accounts, demand deposits, NOW accounts, money market deposit accounts, time deposits, certificates of deposit, individual retirement accounts, and other depository services. In addition, the company offers commercial and industrial loans, real estate construction and land loans, commercial real estate loans, and 1-4 family residential mortgages, as well as consumer loans comprising student loans, revolving credit, and other fixed payment loans. Further, it provides automated teller machines, internet banking, treasury, and cash management services; merchant and debit card services; and wealth and investment advisory, and brokerage services. Additionally, the company offers investment management, corporate trustee, trust and estate administration, IRA administration, house investment management, and custody services. It serves individuals, businesses, and charitable organizations in the Charlottesville/Albemarle County, Fauquier County, Manassas, Prince William County, Richmond, and Winchester market areas in Virginia. Virginia National Bankshares Corporation was founded in 1998 and is headquartered in Charlottesville, Virginia.

About Trustmark

Trustmark Corporation operates as the bank holding company for Trustmark National Bank that provides banking and other financial solutions to individuals and corporate institutions in the United States. The company operates through three segments: General Banking, Wealth Management, and Insurance. It offers checking, savings, and money market accounts; certificates of deposits and individual retirement accounts; financing for commercial and industrial projects, income-producing commercial real estate, owner-occupied real estate, and construction and land development; and installment and real estate loans, and lines of credit, as well as treasury management services. The company also provides mortgage banking services, including construction financing, production of conventional and government-insured mortgages, and secondary marketing and mortgage servicing. In addition, it provides wealth management and trust services, such as administration of personal trusts and estates; management of investment accounts for individuals, employee benefit plans, and charitable foundations; and corporate trust and institutional custody, securities brokerage, financial and estate planning, retirement plan, and investment management services. Further, the company offers business insurance products and services for medical professionals, construction, manufacturing, hospitality, real estate, and group life and health plans; and life and health insurance, and personal line policies for individual customers. Trustmark Corporation was founded in 1889 and is headquartered in Jackson, Mississippi.