Reviewing Middlefield Banc (NASDAQ:MBCN) and United Bankshares (NASDAQ:UBSI)

United Bankshares (NASDAQ:UBSI) and Middlefield Banc (NASDAQ:MBCN) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their risk, analyst recommendations, dividends, institutional ownership, profitability, valuation and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for United Bankshares and Middlefield Banc, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Bankshares	0	3	1	0	2.25
Middlefield Banc	0	2	0	0	2.00

United Bankshares presently has a consensus price target of $40.25, suggesting a potential downside of 4.67%. Middlefield Banc has a consensus price target of $24.00, suggesting a potential downside of 19.68%. Given United Bankshares’ stronger consensus rating and higher probable upside, analysts clearly believe United Bankshares is more favorable than Middlefield Banc.

Profitability

This table compares United Bankshares and Middlefield Banc’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Bankshares	22.05%	7.58%	1.23%
Middlefield Banc	13.31%	6.90%	0.78%

Dividends

United Bankshares pays an annual dividend of $1.48 per share and has a dividend yield of 3.5%. Middlefield Banc pays an annual dividend of $0.80 per share and has a dividend yield of 2.7%. United Bankshares pays out 56.1% of its earnings in the form of a dividend. Middlefield Banc pays out 45.5% 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. United Bankshares has raised its dividend for 25 consecutive years. United Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

70.8% of United Bankshares shares are owned by institutional investors. Comparatively, 31.7% of Middlefield Banc shares are owned by institutional investors. 3.7% of United Bankshares shares are owned by insiders. Comparatively, 3.8% of Middlefield Banc shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares United Bankshares and Middlefield Banc”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Bankshares	$1.54 billion	3.72	$366.31 million	$2.64	15.99
Middlefield Banc	$96.99 million	2.49	$17.37 million	$1.76	16.98

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

Volatility & Risk

United Bankshares has a beta of 0.98, indicating that its share price is 2% less volatile than the S&P 500. Comparatively, Middlefield Banc has a beta of 0.69, indicating that its share price is 31% less volatile than the S&P 500.

Summary

United Bankshares beats Middlefield Banc on 14 of the 17 factors compared between the two stocks.

About United Bankshares

United Bankshares, Inc., through its subsidiaries, primarily provides commercial and retail banking products and services in the United States. It operates through two segments, Community Banking and Mortgage Banking. The company accepts checking, savings, and time and money market accounts; individual retirement accounts; and demand deposits, statement and special savings, and NOW accounts. Its loan products include commercial loans and leases to small to mid-size industrial and commercial companies; construction and real estate loans, such as commercial and residential mortgages, and loans secured by owner-occupied real estate; personal, student, credit card receivables, personal, commercial, and floor plan loans; and home equity loans. In addition, the company provides credit cards; safe deposit boxes, wire transfers, and other banking products and services; investment and security services; services to correspondent banks, including buying and selling federal funds; automated teller machine services; and internet and telephone banking services. Further, it offers community banking services, such as asset management, real property title insurance, financial planning, mortgage banking, and brokerage services, as well as investment management and retirement planning services. United Bankshares, Inc. was incorporated in 1982 and is headquartered in Charleston, West Virginia.

About Middlefield Banc

Middlefield Banc Corp. operates as the bank holding company for The Middlefield Banking Company that provides various commercial banking services to small and medium-sized businesses, professionals, small business owners, and retail customers in northeastern and central Ohio. It offers checking, savings, negotiable order of withdrawal accounts, money market accounts, time certificates of deposit, commercial loans, real estate loans, various consumer loans, safe deposit facilities, and travelers' checks. The company also provides operational and working capital, term business, residential construction, professional, and residential and mortgage loans, as well as consumer installment loans for home improvements, automobiles, boats, and other personal expenditures; loans to finance capital purchases; selected guaranteed or subsidized loan programs for small businesses; and agricultural loans. In addition, the company resolves and disposes troubled assets in Ohio. Further, it offers official checks, money orders, and ATM services, as well as IRA accounts; online banking and bill payment services to individuals; and online cash management services to business customers. Middlefield Banc Corp. was founded in 1901 and is headquartered in Middlefield, Ohio.