Financial Survey: Bank of the James Financial Group (NASDAQ:BOTJ) vs. Renasant (NASDAQ:RNST)

Bank of the James Financial Group (NASDAQ:BOTJ) and Renasant (NASDAQ:RNST) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, institutional ownership, earnings and analyst recommendations.

Institutional and Insider Ownership

18.5% of Bank of the James Financial Group shares are owned by institutional investors. Comparatively, 77.3% of Renasant shares are owned by institutional investors. 15.3% of Bank of the James Financial Group shares are owned by insiders. Comparatively, 2.8% of Renasant shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Bank of the James Financial Group and Renasant, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank of the James Financial Group	0	0	0	0	N/A
Renasant	0	1	5	0	2.83

Renasant has a consensus price target of $39.33, suggesting a potential upside of 23.46%. Given Renasant’s higher possible upside, analysts plainly believe Renasant is more favorable than Bank of the James Financial Group.

Earnings & Valuation

This table compares Bank of the James Financial Group and Renasant”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank of the James Financial Group	$41.85 million	1.47	$8.70 million	$1.95	6.89
Renasant	$639.68 million	2.81	$144.68 million	$2.46	12.95

Renasant has higher revenue and earnings than Bank of the James Financial Group. Bank of the James Financial Group is trading at a lower price-to-earnings ratio than Renasant, indicating that it is currently the more affordable of the two stocks.

Dividends

Bank of the James Financial Group pays an annual dividend of $0.40 per share and has a dividend yield of 3.0%. Renasant pays an annual dividend of $0.88 per share and has a dividend yield of 2.8%. Bank of the James Financial Group pays out 20.5% of its earnings in the form of a dividend. Renasant 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. Bank of the James Financial Group has raised its dividend for 5 consecutive years. Bank of the James Financial Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Bank of the James Financial Group and Renasant’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank of the James Financial Group	15.14%	14.59%	0.87%
Renasant	15.04%	6.98%	0.93%

Risk and Volatility

Bank of the James Financial Group has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500. Comparatively, Renasant has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500.

Summary

Renasant beats Bank of the James Financial Group on 10 of the 16 factors compared between the two stocks.

About Bank of the James Financial Group

Bank of the James Financial Group, Inc. operates as the bank holding company for Bank of the James that provides general retail and commercial banking services to individuals, businesses, associations and organizations, and governmental authorities in Virginia, the United States. It offers checking, savings, individual retirement, and health care saving accounts, as well as other time deposits, including money market accounts and certificates of deposit. The company also provides loans to small- and medium-sized businesses for the purchases of equipment, facilities upgrades, inventory acquisition, and various working capital purposes; commercial and residential construction and development loans; commercial real estate mortgage loans; residential mortgage loans; and secured and unsecured consumer loans, such as lines of credit and overdraft lines of credit, as well as personal, automobile, installment, demand, and home equity loans for personal, family, or household purposes. In addition, it offers other banking services, including safe deposit boxes, traveler's checks, direct deposit of payroll and social security checks, automatic drafts for various accounts, treasury management, and credit card merchant services. Further, the company provides mortgage banking; investment advisory services; securities brokerage and investment services; and telephone and internet banking services comprising online bill pay, as well as acts as an agent for insurance and annuity products. The company was founded in 1999 and is headquartered in Lynchburg, Virginia.

About Renasant

Renasant Corporation operates as a bank holding company for Renasant Bank that provides a range of financial, wealth management, fiduciary, and insurance services to retail and commercial customers. The company operates through Community Banks, Insurance, and Wealth Management segments. The Community Banks segment offers checking and savings accounts, business and personal loans, asset-based lending, and factoring equipment leasing services, as well as safe deposit and night depository facilities. It also provides commercial, financial, and agricultural loans; equipment financing and leasing; real estate1-4 family mortgage; real estatecommercial mortgage; real estateconstruction loans for the construction of single family residential properties, multi-family properties, and commercial projects; installment loans to individuals; and interim construction loans, as well as automated teller machine (ATM), online and mobile banking, call center, and treasury management services. The Insurance segment provides insurance agency services, such as commercial and personal insurance products through insurance carriers. The Wealth Management segment offers a range of wealth management and fiduciary services, including administration and management of trust accounts, such as personal and corporate benefit accounts, and custodial accounts, as well as accounting and money management for trust accounts; annuities, mutual funds, and other investment services through a third party broker-dealer; administrative and compliance services; and qualified retirement plans, IRAs, employee benefit plans, personal trusts, and estates. Renasant Corporation was founded in 1904 and is headquartered in Tupelo, Mississippi.