National Farmers’ Bank (NASDAQ: FMNB – Get a rating) and QCR (NASDAQ: QCRH – Get a rating) are both small cap finance companies, but which is the better investment? We’ll compare the two companies based on their risk strength, analyst recommendations, earnings, dividends, valuation, profitability, and institutional ownership.
Farmers National Banc pays an annual dividend of $0.64 per share and has a dividend yield of 4.1%. QCR pays an annual dividend of $0.24 per share and has a dividend yield of 0.4%. Farmers National Banc pays 36.4% of its profits as a dividend. QCR pays 3.6% of its profits as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings over the next few years. Farmers National Banc has increased its dividend for 7 consecutive years. Farmers National Banc is clearly the best dividend stock, given its higher yield and longer track record of dividend growth.
Volatility and risk
Farmers National Banc has a beta of 0.91, which means its stock price is 9% less volatile than the S&P 500. In comparison, QCR has a beta of 0.98, which means its stock price is 2% less volatile than the S&P 500.
Insider and Institutional Ownership
38.6% of Farmers National Banc shares are held by institutional investors. By comparison, 69.5% of QCR’s shares are held by institutional investors. 8.1% of Farmers National Banc shares are held by insiders of the company. By comparison, 3.8% of QCR’s shares are held by insiders of the company. Strong institutional ownership indicates that hedge funds, large money managers, and endowments believe a company is poised for long-term growth.
This is a breakdown of recent recommendations and price targets for Farmers National Banc and QCR, as reported by MarketBeat.
|Sales Ratings||Hold odds||Buy reviews||Strong buy odds||Rating|
|National Farmers Bench||0||0||1||0||3.00|
The Farmers National Banc currently has a consensus price target of $20.00, which suggests a potential upside of 29.37%. QCR has a consensus price target of $71.50, suggesting a potential upside of 27.02%. Given Farmers National Banc’s likely higher upside, equity research analysts clearly believe Farmers National Banc is more favorable than QCR.
Valuation and benefits
This table compares revenue, earnings per share (EPS), and valuation of Farmers National Banc and QCR.
|Gross revenue||Price/sales ratio||Net revenue||Earnings per share||Price/earnings ratio|
|National Farmers Bench||$154.65 million||3.40||$51.84 million||$1.76||8.78|
|QCR||$300.58 million||3.31||$98.90 million||$6.58||8.55|
QCR has higher revenues and profits than Farmers National Banc. QCR trades at a lower price-to-earnings ratio than Farmers National Banc, indicating that it is currently the more affordable of the two stocks.
This table compares the net margins, return on equity and return on assets of Farmers National Banc and QCR.
|Net margins||Return on equity||return on assets|
|National Farmers Bench||31.61%||16.27%||1.76%|
QCR beats Farmers National Banc on 9 of the 16 factors compared between the two stocks.
About the National Farmers Bench
Farmers National Banc Corp., a financial holding company, operates in banking, trust, pension advisory, insurance and financial management. It offers commercial and retail banking services, including checking, savings and term deposit accounts; commercial, mortgage and installment loans, and home equity loans; home equity lines of credit, night deposit, safety deposit box, money order, bank check, ATM, Internet banking, travel card, electronic bond transaction, MasterCard and Visa credit cards, brokerage and other services. The company also provides trust services to individuals and businesses in the areas of estate settlement, administration of trusts and employee benefit plans; retirement services; property and casualty insurance products and services; and various insurance products through authorized representatives, as well as investments in municipal securities. It operates through 47 locations in northeastern Ohio and one location in southwestern Pennsylvania. The company was founded in 1887 and is based in Canfield, Ohio.
QCR Holdings, Inc., a multi-bank holding company, provides corporate and personal banking services, as well as trust and asset management services. Its deposit products include non-interest bearing demand, interest bearing demand, term and traded deposits. The Company also provides various commercial and retail and investment lending/leasing services to companies, partnerships, individuals and government agencies. Its loan portfolio includes loans to small and medium enterprises; business loans, including lines of credit for working capital and operational purposes; term loans for the acquisition of plant, equipment and other purposes; commercial and residential real estate loans; and installment loans and other consumer loans, such as home improvement loans, home equity, motor vehicle and signature loans, as well as small personal lines of credit. In addition, the Company engages in the rental of machinery and equipment to commercial and industrial enterprises under direct leasing contracts; and the issuance of trust preferred securities. It serves the communities of Quad Cities, Cedar Rapids, Cedar Valley, Des Moines/Ankeny and Springfield. The company was founded in 1993 and is headquartered in Moline, Illinois.
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