Head to Head Analysis: Union Bankshares (NASDAQ:UNB) versus Valley National Bancorp (NASDAQ:VLY)

Valley National Bancorp (NASDAQ:VLY) and Union Bankshares (NASDAQ:UNB) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, valuation, institutional ownership, profitability and analyst recommendations.

Profitability

This table compares Valley National Bancorp and Union Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Valley National Bancorp	17.11%	7.92%	0.92%
Union Bankshares	12.75%	15.18%	0.73%

Volatility and Risk

Valley National Bancorp has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, Union Bankshares has a beta of 0.42, meaning that its stock price is 58% less volatile than the S&P 500.

Valuation & Earnings

This table compares Valley National Bancorp and Union Bankshares”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Valley National Bancorp	$3.49 billion	1.90	$597.98 million	$1.01	11.83
Union Bankshares	$86.06 million	1.26	$11.08 million	$2.43	9.77

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

Insider and Institutional Ownership

61.0% of Valley National Bancorp shares are held by institutional investors. Comparatively, 14.8% of Union Bankshares shares are held by institutional investors. 1.4% of Valley National Bancorp shares are held by insiders. Comparatively, 1.1% of Union Bankshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and target prices for Valley National Bancorp and Union Bankshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Valley National Bancorp	0	3	12	2	2.94
Union Bankshares	0	1	0	0	2.00

Valley National Bancorp currently has a consensus price target of $14.40, suggesting a potential upside of 20.55%. Given Valley National Bancorp’s stronger consensus rating and higher probable upside, equities analysts plainly believe Valley National Bancorp is more favorable than Union Bankshares.

Dividends

Valley National Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 3.7%. Union Bankshares pays an annual dividend of $1.44 per share and has a dividend yield of 6.1%. Valley National Bancorp pays out 43.6% of its earnings in the form of a dividend. Union Bankshares pays out 59.3% 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

Valley National Bancorp beats Union Bankshares on 14 of the 17 factors compared between the two stocks.

About Valley National Bancorp

Valley National Bancorp operates as the holding company for Valley National Bank that provides various commercial, private banking, retail, insurance, and wealth management financial services products. It operates through Consumer Banking, Commercial Banking, and Treasury and Corporate other segments. The company offers non-interest bearing, savings, NOW, money market, and time deposit accounts; commercial and industrial, commercial real estate, residential mortgage, and automobile loans; loans secured by the cash surrender value of life insurance; home equity loans and lines of credit; automobile financing; and secured and unsecured other consumer loans. It also invests in various securities and interest-bearing deposits with other banks; and provides international banking services, such as standby and documentary letters of credit, and related products, as well as foreign exchange transactions, documentary collections, and foreign wire transfers services. In addition, the company offers investment services for individuals and small to medium sized businesses; and trusts investment strategies designed for various investment profiles and objectives. Further, it provides trust services, such as living and testamentary trusts, investment management, custodial and escrow services, and estate administration to individuals; tax credit advisory services; brokerage services; property and casualty, life, health, and title insurance agency services; and health care equipment lending and other commercial equipment leasing services, as well as owns real estate related investments. Additionally, the company offers online, mobile, and telephone banking services; receivable, payment, and security solution, merchant, payroll processing, and liquidity services; credit cards; and drive-in and night deposit, automated teller machine, remote deposit capture, and safe deposit facility services. Valley National Bancorp was founded in 1927 and is headquartered in Morristown, New Jersey.

About Union Bankshares

Union Bankshares, Inc. operates as the bank holding company for Union Bank that provides retail, commercial, and municipal banking products and services in northern Vermont and New Hampshire. It offers retail depository services, such as personal checking, savings, money market, IRA/SEP/KEOGH, and health savings accounts, as well as certificates of deposit. The company also provides commercial real estate loans; commercial loans for plant and equipment, working capital, real estate renovation, and other business purposes to business owners and investors; small business administration guaranteed loans; residential construction and mortgage loans; municipal financing, including loans and excess deposits secured by FHLBB letters of credit; and home improvement loans and overdraft checking privileges against preauthorized lines of credit. In addition, it offers online cash management services, including account reconciliation, credit card depository, automated clearing house origination, wire transfers, positive pay and night depository services; merchant credit card services for the deposit and immediate credit of sales drafts; remote deposit capture services; and online mortgage application and consumer deposit account opening services. Further, the company provides business checking accounts; standby letters of credit, bank checks or money orders, and safe deposit boxes; ATM cards and services; debit cards; telephone, internet, and mobile banking services, including bill pay; and wealth management, fiduciary, and trust services. It offers retail banking services to individuals; and commercial banking services to small and medium sized business corporations, limited liability companies, partnerships, and sole proprietorships, as well as nonprofit organizations, local municipalities, and school districts. Union Bankshares, Inc. was founded in 1891 and is headquartered in Morrisville, Vermont.