BOK Financial (BOKF) & First United (FUNC) Critical Contrast

BOK Financial (NASDAQ:BOKF) and First United (NASDAQ:FUNC) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, dividends, earnings, valuation, risk, analyst recommendations and institutional ownership.

Profitability

This table compares BOK Financial and First United’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BOK Financial 23.03% 11.64% 1.30%
First United 16.38% 9.67% 0.83%

Institutional & Insider Ownership

39.3% of BOK Financial shares are owned by institutional investors. Comparatively, 35.5% of First United shares are owned by institutional investors. 54.9% of BOK Financial shares are owned by company insiders. Comparatively, 4.3% of First United shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and target prices for BOK Financial and First United, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BOK Financial 0 5 4 0 2.44
First United 0 0 0 0 N/A

BOK Financial presently has a consensus price target of $100.17, indicating a potential upside of 24.54%. Given BOK Financial’s higher possible upside, equities research analysts clearly believe BOK Financial is more favorable than First United.

Risk and Volatility

BOK Financial has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500. Comparatively, First United has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500.

Earnings & Valuation

This table compares BOK Financial and First United’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
BOK Financial $1.85 billion 3.11 $445.65 million $6.78 11.86
First United $67.33 million 1.93 $10.67 million N/A N/A

BOK Financial has higher revenue and earnings than First United.

Dividends

BOK Financial pays an annual dividend of $2.00 per share and has a dividend yield of 2.5%. First United pays an annual dividend of $0.36 per share and has a dividend yield of 2.0%. BOK Financial pays out 29.5% of its earnings in the form of a dividend. BOK Financial has raised its dividend for 14 consecutive years. BOK Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

BOK Financial beats First United on 14 of the 15 factors compared between the two stocks.

About BOK Financial

BOK Financial Corporation operates as the financial holding company for BOKF, NA that provides various financial products and services in Oklahoma, Texas, New Mexico, Northwest Arkansas, Colorado, Arizona, and Kansas/Missouri. It operates through three segments: Commercial Banking, Consumer Banking, and Wealth Management. The Commercial Banking segment offers lending, treasury, and cash management services, as well as customer risk management products for small businesses, middle market, and larger commercial customers. This segment also operates TransFund electronic funds network. The Consumer Banking segment provides lending and deposit services to small business customers through the retail branch network; and mortgage banking services. The Wealth Management segment offers fiduciary, private banking, and investment advisory services; and brokerage and trading services, as well as underwrites state and municipal securities. The company also provides commercial loans, such as loans for working capital, facilities acquisition or expansion, purchases of equipment, and other needs of commercial customers; and service, healthcare, wholesale/retail sector, and energy sector loans. In addition, it offers commercial real estate loans for the construction of buildings or other enhancements to real estate and property held by borrowers for investment purposes; and residential mortgage, personal, and home equity loans. Further, the company provides automated teller machine (ATM), call center, and Internet and mobile banking services. As of December 31, 2018, it operated 2,426 TransFund ATM locations. BOK Financial Corporation was founded in 1910 and is headquartered in Tulsa, Oklahoma.

About First United

First United Corporation operates as the holding company for First United Bank & Trust that provides various retail and commercial banking services to businesses and individuals. The company offers various deposit products, including checking accounts, savings and money market accounts, regular and individual retirement accounts (IRA) certificates of deposit, Christmas savings accounts, college savings accounts, and health savings accounts; Certificate of Deposit Account Registry Service program and Insured Cash Sweep program to municipalities, businesses, and consumers; and commercial customers packages, which include treasury management, cash sweep, and various checking opportunities. It also provides loans, such as commercial loans secured by real estate, commercial equipment, vehicles, or other assets of the borrower; commercial real estate loans for residential and commercial development, agricultural purpose properties, and service industry buildings; residential mortgage loans; home equity lines of credit; residential real estate construction loans; indirect and direct auto loans; and other secured and unsecured lines of credit and term loans. In addition, the company offers various trust services, including personal trust, investment agency accounts, charitable trusts, retirement accounts that consist of IRA roll-overs, 401(k) accounts and defined benefit plans, estate administration, and estate planning services; insurance products; brokerage services; and safe deposit, and night depository facilities. It operates 25 banking offices, 1 call center, and 26 automated teller machines in Allegany, Frederick, Garrett, and Washington counties in Maryland; and in Mineral, Berkeley, and Monongalia counties in West Virginia. First United Corporation was founded in 1900 and is headquartered in Oakland, Maryland.

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