OFG Bancorp (NYSE:OFG) versus First National (NASDAQ:FXNC) Financial Contrast

OFG Bancorp (NYSE:OFGGet Rating) and First National (NASDAQ:FXNCGet Rating) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Institutional and Insider Ownership

91.0% of OFG Bancorp shares are owned by institutional investors. Comparatively, 33.8% of First National shares are owned by institutional investors. 2.7% of OFG Bancorp shares are owned by insiders. Comparatively, 15.7% of First National shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares OFG Bancorp and First National’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
OFG Bancorp $578.46 million 2.27 $146.15 million $3.13 8.81
First National $47.32 million 2.31 $10.36 million $2.27 7.70

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for OFG Bancorp and First National, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
OFG Bancorp 0 0 0 0 N/A
First National 0 0 1 0 3.00

OFG Bancorp presently has a consensus price target of $33.00, suggesting a potential upside of 19.61%. First National has a consensus price target of $21.50, suggesting a potential upside of 23.00%. Given First National’s higher probable upside, analysts clearly believe First National is more favorable than OFG Bancorp.

Dividends

OFG Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 2.9%. First National pays an annual dividend of $0.56 per share and has a dividend yield of 3.2%. OFG Bancorp pays out 25.6% of its earnings in the form of a dividend. First National pays out 24.7% 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. OFG Bancorp has raised its dividend for 2 consecutive years and First National has raised its dividend for 7 consecutive years. First National is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares OFG Bancorp and First National’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
OFG Bancorp 25.03% 14.88% 1.52%
First National 24.57% 13.43% 1.01%

Risk and Volatility

OFG Bancorp has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500. Comparatively, First National has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500.

Summary

OFG Bancorp beats First National on 9 of the 16 factors compared between the two stocks.

About OFG Bancorp

(Get Rating)

OFG Bancorp, a financial holding company, provides a range of banking and financial services. It operates through three segments: Banking, Wealth Management, and Treasury. The company offers checking and savings accounts, as well as time deposit products; commercial, consumer, auto, and mortgage lending services; financial planning and insurance services; and corporate and individual trust, and retirement services. It also provides securities brokerage and investment advisory services, including various investment alternatives, such as tax-advantaged fixed income securities, mutual funds, stocks, and bonds to retail and institutional clients; and separately-managed accounts and mutual fund asset allocation programs. In addition, the company engages in the insurance agency and reinsurance businesses; administration and servicing of retirement plans; various treasury-related functions with an investment portfolio consisting of mortgage-backed securities, obligations of U.S. government sponsored agencies, and U.S. Treasury securities and money market instruments; and management and participation in public offerings and private placements of debt and equity securities. Further, it offers money management and investment banking services; and engages in the asset/liability management activities, such as purchases and sales of investment securities, interest rate risk management, derivatives, and borrowings. The company operates through a network of 50 branches in Puerto Rico and 2 branches in USVI. OFG Bancorp was founded in 1964 and is headquartered in San Juan, Puerto Rico.

About First National

(Get Rating)

First National Corp. is a bank holding company engaged in the provision of consumer and business banking services through its subsidiary, First Bank. The firm offers savings, checking, mortgage lending, home equity, treasury management, construction loan, commercial mortgage, and rental properties. The company was founded on September 7, 1983 and is headquartered in Strasburg, VA.

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