United Bancorporation of Alabama (OTCMKTS:UBAB) & Eagle Financial Services (NASDAQ:EFSI) Head-To-Head Contrast

Eagle Financial Services (NASDAQ:EFSI) and United Bancorporation of Alabama (OTCMKTS:UBAB) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, risk, earnings, analyst recommendations and profitability.

Dividends

Eagle Financial Services pays an annual dividend of $1.24 per share and has a dividend yield of 2.7%. United Bancorporation of Alabama pays an annual dividend of $1.42 per share and has a dividend yield of 2.3%. Eagle Financial Services pays out 37.6% of its earnings in the form of a dividend. United Bancorporation of Alabama pays out 23.1% 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. Eagle Financial Services has increased its dividend for 14 consecutive years. Eagle Financial Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

0.3% of Eagle Financial Services shares are held by institutional investors. Comparatively, 5.5% of United Bancorporation of Alabama shares are held by institutional investors. 7.1% of Eagle Financial Services shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Eagle Financial Services and United Bancorporation of Alabama”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eagle Financial Services	$105.89 million	2.33	$8.21 million	$3.30	13.82
United Bancorporation of Alabama	$89.83 million	2.11	$19.67 million	$6.15	10.08

United Bancorporation of Alabama has lower revenue, but higher earnings than Eagle Financial Services. United Bancorporation of Alabama is trading at a lower price-to-earnings ratio than Eagle Financial Services, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Eagle Financial Services has a beta of 0.21, suggesting that its share price is 79% less volatile than the S&P 500. Comparatively, United Bancorporation of Alabama has a beta of 0.45, suggesting that its share price is 55% less volatile than the S&P 500.

Profitability

This table compares Eagle Financial Services and United Bancorporation of Alabama’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eagle Financial Services	14.55%	8.02%	0.82%
United Bancorporation of Alabama	23.54%	14.40%	1.49%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Eagle Financial Services and United Bancorporation of Alabama, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eagle Financial Services	0	3	2	1	2.67
United Bancorporation of Alabama	0	1	0	0	2.00

Eagle Financial Services currently has a consensus price target of $43.75, suggesting a potential downside of 4.08%. Given Eagle Financial Services’ stronger consensus rating and higher probable upside, research analysts clearly believe Eagle Financial Services is more favorable than United Bancorporation of Alabama.

Summary

Eagle Financial Services beats United Bancorporation of Alabama on 10 of the 18 factors compared between the two stocks.

About Eagle Financial Services

Eagle Financial Services, Inc. operates as the bank holding company for Bank of Clarke County that provides various retail and commercial banking products and services in the Shenandoah Valley and Northern Virginia. The company’s deposit products include checking, NOW, money market, and regular savings accounts; and demand and time deposits. Its loan portfolio comprises one-to-four-family residential real estate, commercial real estate, construction and land development, and commercial and industrial loans, as well as secured and unsecured consumer loans, which include personal installment loans, personal lines of credit, automobile loans, and credit card loans. The company also offers personal and retirement plan services; investment services comprising tax-deferred annuities, IRAs and rollovers, mutual funds, retirement plans, college savings plans, life insurance, long term care insurance, fixed income investing, brokerage CDs, and full service or discount brokerage services; non-deposit investment products; and title insurance products. In addition, it provides ATM and debit cards; and telephone, internet, and mobile banking services, as well as other commercial deposit account services, such as ACH origination and remote deposit capture services. The company operates through twelve full-service branches, two loan production offices, one wealth management office, and one drive-through only facility, as well as 13 ATM locations in the Virginia communities of Berryville, Winchester, Boyce, Stephens City, Purcellville, Warrenton, Leesburg, Ashburn, and Fairfax. Eagle Financial Services, Inc. was founded in 1881 and is headquartered in Berryville, Virginia.

About United Bancorporation of Alabama

United Bancorporation of Alabama, Inc. operates as the bank holding company for United Bank that provides banking services. The company offers checking and savings accounts, certificates of deposit, individual retirement accounts, small business programs, business solutions, merchant services, and cash management services. It also provides various lending services, such as personal loans, business loans, lines of credit, and equipment loans; real estate loans for the agricultural community and working lines of credit; and overdraft services. In addition, the company offers debit cards, prepaid cards, Visa credit cards, gift cards, and safe deposit boxes. Further, it provides check cashing, convenience, remote deposit, mobile check deposit, personal storage compartments, Web payment options, insurance products, investment and brokerage, and online and mobile banking services. United Bancorporation of Alabama, Inc. was founded in 1904 and is based in Atmore, Alabama.