First BanCorp. (NYSE:FBP – Get Rating) and German American Bancorp (NASDAQ:GABC – Get Rating) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, profitability and risk.
Risk and Volatility
First BanCorp. has a beta of 1.17, meaning that its stock price is 17% more volatile than the S&P 500. Comparatively, German American Bancorp has a beta of 0.7, meaning that its stock price is 30% less volatile than the S&P 500.
First BanCorp. pays an annual dividend of $0.48 per share and has a dividend yield of 3.3%. German American Bancorp pays an annual dividend of $0.92 per share and has a dividend yield of 2.5%. First BanCorp. pays out 32.0% of its earnings in the form of a dividend. German American Bancorp pays out 34.6% 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. First BanCorp. has raised its dividend for 2 consecutive years and German American Bancorp has raised its dividend for 10 consecutive years. First BanCorp. is clearly the better dividend stock, given its higher yield and lower payout ratio.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|German American Bancorp||0||0||1||0||3.00|
First BanCorp. presently has a consensus target price of $16.33, indicating a potential upside of 13.19%. German American Bancorp has a consensus target price of $39.50, indicating a potential upside of 5.22%. Given First BanCorp.’s higher possible upside, research analysts plainly believe First BanCorp. is more favorable than German American Bancorp.
Insider and Institutional Ownership
96.2% of First BanCorp. shares are owned by institutional investors. Comparatively, 40.7% of German American Bancorp shares are owned by institutional investors. 2.1% of First BanCorp. shares are owned by company insiders. Comparatively, 6.7% of German American Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This table compares First BanCorp. and German American Bancorp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|German American Bancorp||29.43%||13.72%||1.44%|
Valuation & Earnings
This table compares First BanCorp. and German American Bancorp’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|First BanCorp.||$915.87 million||2.96||$281.02 million||$1.50||9.62|
|German American Bancorp||$229.84 million||4.82||$84.14 million||$2.66||14.11|
First BanCorp. has higher revenue and earnings than German American Bancorp. First BanCorp. is trading at a lower price-to-earnings ratio than German American Bancorp, indicating that it is currently the more affordable of the two stocks.
First BanCorp. beats German American Bancorp on 11 of the 16 factors compared between the two stocks.
About First BanCorp.
First BanCorp. operates as a bank holding company for FirstBank Puerto Rico that provides various financial services for retail, commercial, and institutional clients. The company operates through six segments: Commercial and Corporate Banking, Mortgage Banking, Consumer (Retail) Banking, Treasury and Investments, United States Operations, and Virgin Islands Operations. The Commercial and Corporate Banking segment offers commercial loans, including commercial real estate and construction loans and floor plan financings; and other products, such as cash management and business management services. The Mortgage Banking segment engages in the origination, sale, and servicing of various residential mortgage loans; acquisition and sale of mortgages in the secondary markets; and purchase of mortgage loans from other local banks and mortgage bankers. The Consumer (Retail) Banking segment provides auto, boat, credit card, and personal loans; lines of credit; deposit products comprising interest bearing and non-interest bearing checking and savings accounts, individual retirement accounts, and retail certificates of deposit (CDs); and finance leasing and insurance agency services. The Treasury and Investments segment offers funding and liquidity management services. The United States Operations segment provides checking, savings, and money market accounts, as well as retail CDs; traditional commercial and industrial, and commercial real estate loans; and internet banking, cash management, remote deposit capture, and automated clearing house, and transactions services. The Virgin Islands Operations segment is involved in consumer, commercial lending, and deposit-taking activities. The company operates 64 branches in Puerto Rico, 8 branches in the U.S. Virgin Islands and British Virgin Islands, and 11 branches in the state of Florida. First BanCorp. was founded in 1948 and is headquartered in San Juan, Puerto Rico.
About German American Bancorp
German American Bancorp, Inc. operates as a bank holding company for German American Bank that provides retail and commercial banking services. The company operates through three segments: Core Banking, Wealth Management Services, and Insurance Operations. The Core Banking segment accepts deposits from the general public; and originates consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, as well as sells residential mortgage loans in the secondary market. The Wealth Management segment provides trust, investment advisory, brokerage, and retirement planning services. The Insurance Operations segment offers a range of personal and corporate property and casualty insurance products. As of December 31, 2021, the company operated 77 banking offices in 19 contiguous southern Indiana counties; and 14 counties in Kentucky. German American Bancorp, Inc. was founded in 1910 and is based in Jasper, Indiana.
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