First Commonwealth Financial (NYSE:FCF) and Bank First (NASDAQ:BFC) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, risk, earnings and valuation.
First Commonwealth Financial pays an annual dividend of $0.46 per share and has a dividend yield of 3.5%. Bank First pays an annual dividend of $0.84 per share and has a dividend yield of 1.2%. First Commonwealth Financial pays out 56.8% of its earnings in the form of a dividend. Bank First pays out 16.6% 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 Commonwealth Financial has raised its dividend for 1 consecutive years and Bank First has raised its dividend for 1 consecutive years.
This table compares First Commonwealth Financial and Bank First’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|First Commonwealth Financial||28.58%||11.03%||1.29%|
Volatility & Risk
First Commonwealth Financial has a beta of 1.14, indicating that its stock price is 14% more volatile than the S&P 500. Comparatively, Bank First has a beta of 0.37, indicating that its stock price is 63% less volatile than the S&P 500.
Institutional & Insider Ownership
68.1% of First Commonwealth Financial shares are held by institutional investors. Comparatively, 26.0% of Bank First shares are held by institutional investors. 1.7% of First Commonwealth Financial shares are held by insiders. Comparatively, 7.6% of Bank First shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Valuation and Earnings
This table compares First Commonwealth Financial and Bank First’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|First Commonwealth Financial||$395.68 million||3.22||$73.45 million||$0.81||16.40|
|Bank First||$124.22 million||4.26||$38.05 million||$5.07||13.61|
First Commonwealth Financial has higher revenue and earnings than Bank First. Bank First is trading at a lower price-to-earnings ratio than First Commonwealth Financial, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings for First Commonwealth Financial and Bank First, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|First Commonwealth Financial||0||4||2||0||2.33|
First Commonwealth Financial presently has a consensus target price of $13.50, suggesting a potential upside of 1.66%. Bank First has a consensus target price of $60.00, suggesting a potential downside of 13.02%. Given First Commonwealth Financial’s stronger consensus rating and higher possible upside, analysts clearly believe First Commonwealth Financial is more favorable than Bank First.
About First Commonwealth Financial
First Commonwealth Financial Corp. is a financial holding company, which engages in the provision of a diversified array of consumer and commercial banking services through its bank subsidiary, First Commonwealth Bank (FCB). It also offers trust and wealth management services and offer insurance products through FCB and its other operating subsidiaries. The firm’s consumer services include Internet, mobile, and telephone banking; an automated teller machine network; personal checking accounts; interest-earning checking accounts; savings accounts; insured money market accounts; debit cards; investment certificates; fixed and variable rate certificates of deposit; secured and unsecured installment loans; construction and real estate loans; safe deposit facilities; credit lines with overdraft checking protection; and IRA accounts. Its commercial banking services include commercial lending, small and high-volume business checking accounts, on-line account management services, ACH origination, payroll direct deposit, commercial cash management services and repurchase agreements. The company was founded on November 15, 1982 and is headquartered in Indiana, PA.
About Bank First
Bank First Corp. is a bank holding company, which engages in the provision of financial products and services to individual and business customers. It offers checking accounts, savings accounts, money market accounts, cash management accounts, certificates of deposit, commercial and industrial loans, commercial real estate loans, construction and development loans, residential mortgages, consumer loans, credit cards, online banking, telephone banking, and mobile banking. The company was founded on April 9, 1982 and is headquartered in Manitowoc, WI.
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