Hilltop (NYSE:HTH) and Lakeland Bancorp (NASDAQ:LBAI) Critical Survey

Hilltop (NYSE:HTHGet Rating) and Lakeland Bancorp (NASDAQ:LBAIGet Rating) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Earnings and Valuation

This table compares Hilltop and Lakeland Bancorp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hilltop $1.94 billion 0.89 $374.49 million $2.66 10.09
Lakeland Bancorp $279.68 million 3.90 $95.04 million $1.55 10.87

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

Profitability

This table compares Hilltop and Lakeland Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hilltop 13.07% 8.78% 1.17%
Lakeland Bancorp 28.25% 9.74% 1.01%

Volatility & Risk

Hilltop has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500. Comparatively, Lakeland Bancorp has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Hilltop and Lakeland Bancorp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hilltop 1 0 0 0 1.00
Lakeland Bancorp 0 0 1 0 3.00

Hilltop currently has a consensus target price of $28.00, suggesting a potential upside of 4.28%. Lakeland Bancorp has a consensus target price of $17.00, suggesting a potential upside of 0.89%. Given Hilltop’s higher probable upside, research analysts plainly believe Hilltop is more favorable than Lakeland Bancorp.

Dividends

Hilltop pays an annual dividend of $0.60 per share and has a dividend yield of 2.2%. Lakeland Bancorp pays an annual dividend of $0.58 per share and has a dividend yield of 3.4%. Hilltop pays out 22.6% of its earnings in the form of a dividend. Lakeland Bancorp pays out 37.4% 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. Hilltop has raised its dividend for 5 consecutive years and Lakeland Bancorp has raised its dividend for 11 consecutive years. Lakeland Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

61.2% of Hilltop shares are held by institutional investors. Comparatively, 57.8% of Lakeland Bancorp shares are held by institutional investors. 23.4% of Hilltop shares are held by company insiders. Comparatively, 4.7% of Lakeland Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Hilltop beats Lakeland Bancorp on 9 of the 17 factors compared between the two stocks.

About Hilltop

(Get Rating)

Hilltop Holdings Inc. provides business and consumer banking, and financial products and services. It operates through three segments: Banking, Broker-Dealer, and Mortgage Origination. The Banking segment offers savings, checking, interest-bearing checking, and money market accounts; certificates of deposit; lines and letters of credit, home improvement and equity loans, loans for purchasing and carrying securities, equipment loans and leases, agricultural and commercial real estate loans, and other loans; and commercial and industrial loans, and term and construction finance. This segment also provides treasury management, wealth management, asset management, check cards, safe deposit boxes, online banking, bill pay, trust, and overdraft services; and estate planning, management and administration, investment portfolio management, employee benefit accounts, and individual retirement accounts, as well as automated teller machines. The Broker-Dealer segment offers public finance services that assist public entities in originating, syndicating, and distributing securities of municipalities and political subdivisions; specialized advisory and investment banking services; advice and guidance to arbitrage rebate compliance, portfolio management, and local government investment pool administration; structured finance services, which include advisory services for derivatives and commodities; sells, trades in, and underwrites U.S. government and government agency bonds, corporate bonds, and municipal bonds, as well as mortgage-backed, asset-backed, and commercial mortgage-backed securities and structured products. This segment also provides asset and liability management advisory, clearing, retail, and securities lending services. The Mortgage Origination segment offers mortgage, jumbo, Federal Housing Administration, Veterans Affairs, and United States Department of Agriculture loans. Hilltop Holdings Inc. was founded in 1998 and is headquartered in Dallas, Texas.

About Lakeland Bancorp

(Get Rating)

Lakeland Bancorp, Inc. operates as the bank holding company for Lakeland Bank that offers various banking products and services for individuals and small to medium sized businesses. The company provides commercial banking services, including savings, money market, and time accounts, as well as demand deposits. It is also involved in lending services, including commercial real estate loans, commercial and industrial loans, short and medium term loans, lines of credit, letters of credit, inventory and accounts receivable financing, real estate construction loans, residential mortgage loans, Small Business Administration (SBA) loans, and merchant credit card services; financing solutions to small and medium-sized companies; online banking, mobile banking, and wire transfer services; and cash management services, such as remote capture of deposits and overnight sweep repurchase agreements. In addition, it provides consumer banking services, which include checking accounts, savings accounts, interest-bearing checking accounts, money market accounts, certificates of deposit, online banking, secured and unsecured loans, consumer installment loans, mortgage loans, and safe deposit services. Further, the company offers investment advisory services for individuals and businesses; and securities brokerage services, including mutual funds and variable annuities, as well as commercial title insurance services and life insurance products. As of December 31, 2021, it operated 48 branch offices located throughout Bergen, Essex, Morris, Ocean, Passaic, Somerset, Sussex, and Union counties in New Jersey and in Highland Mills, New York; operated six New Jersey regional commercial lending centers in Bernardsville, Iselin, Jackson, Montville, Teaneck and Waldwick; and one New York commercial lending center to serve the Hudson Valley region. The company was incorporated in 1969 and is headquartered in Oak Ridge, New Jersey.

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