Critical Survey: HBT Financial (NASDAQ:HBT) versus Enterprise Bancorp (NASDAQ:EBTC)

Enterprise Bancorp (NASDAQ:EBTC) and HBT Financial (NASDAQ:HBT) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, dividends, earnings and analyst recommendations.

Insider and Institutional Ownership

38.9% of Enterprise Bancorp shares are owned by institutional investors. Comparatively, 78.6% of HBT Financial shares are owned by institutional investors. 21.7% of Enterprise Bancorp shares are owned by insiders. Comparatively, 59.8% of HBT Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Enterprise Bancorp and HBT Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Enterprise Bancorp	15.30%	11.15%	0.82%
HBT Financial	24.99%	14.57%	1.50%

Valuation and Earnings

This table compares Enterprise Bancorp and HBT Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Enterprise Bancorp	$170.74 million	3.11	$38.73 million	$3.12	13.67
HBT Financial	$222.37 million	3.52	$71.78 million	$2.26	10.97

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

Dividends

Enterprise Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 2.3%. HBT Financial pays an annual dividend of $0.84 per share and has a dividend yield of 3.4%. Enterprise Bancorp pays out 32.1% of its earnings in the form of a dividend. HBT Financial pays out 37.2% 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.

Volatility & Risk

Enterprise Bancorp has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500. Comparatively, HBT Financial has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for Enterprise Bancorp and HBT Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Enterprise Bancorp	0	0	0	0	0.00
HBT Financial	1	2	2	0	2.20

HBT Financial has a consensus target price of $24.80, indicating a potential upside of 0.00%. Given HBT Financial’s stronger consensus rating and higher probable upside, analysts clearly believe HBT Financial is more favorable than Enterprise Bancorp.

Summary

HBT Financial beats Enterprise Bancorp on 13 of the 16 factors compared between the two stocks.

About Enterprise Bancorp

Enterprise Bancorp, Inc. operates as the holding company for Enterprise Bank and Trust Company that engages in the provision of commercial banking products and services. It offers commercial and retail deposit products, including checking accounts, limited-transactional savings and money market accounts, commercial sweep products, and term certificates of deposit. The company also provides commercial real estate, commercial and industrial, commercial construction, residential, and consumer loans, as well as home equity loans and lines of credit. In addition, the company offers cash management services; wealth advisory and management services that include customized investment management and trust services to individuals, family groups, commercial businesses, trusts, foundations, non-profit organizations, and endowments; brokerage and management services to individual investors; insurance services; and online and mobile banking services. The company was founded in 1989 and is headquartered in Lowell, Massachusetts.

About HBT Financial

HBT Financial, Inc. operates as the bank holding company for Heartland Bank and Trust Company that provides business, commercial, and retail banking products and services to individuals, businesses, and municipal entities in Central and Northeastern Illinois, and Eastern Iowa. The company's deposits accounts consist of noninterest-bearing demand deposits, interest-bearing transaction accounts, money market accounts, savings accounts, certificates of deposits, health savings accounts, and individual retirement accounts. Its loan offering comprises owner and non-owner occupied commercial real estate; construction and land development and multi-family; commercial and industrial; agricultural and farmland; and one-to-four family residential loans, as well as municipal, consumer, and other loans. The company also offers wealth management services, including financial planning to consumers, trusts, and estates; trustee and custodial; investment management; corporate retirement plan consulting and administration; and retail brokerage services. In addition, it provides farmland management, and farmland sales and services; commercial checking accounts; and treasury management services, as well as originates and sells residential mortgage loans. Further, the company offers digital banking services, such as online and mobile banking, and digital payment services, as well as personal financial management tools. The company was formerly known as Heartland Bancorp, Inc. and changed its name to HBT Financial, Inc. in September 2019. HBT Financial, Inc. was founded in 1920 and is headquartered in Bloomington, Illinois.