Financial Survey: First Business Financial Services (NASDAQ:FBIZ) & Mid Penn Bancorp (NASDAQ:MPB)

First Business Financial Services (NASDAQ:FBIZGet Free Report) and Mid Penn Bancorp (NASDAQ:MPBGet Free Report) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, risk, valuation, institutional ownership, analyst recommendations and earnings.

Dividends

First Business Financial Services pays an annual dividend of $0.91 per share and has a dividend yield of 2.5%. Mid Penn Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 3.5%. First Business Financial Services pays out 20.8% of its earnings in the form of a dividend. Mid Penn Bancorp pays out 31.5% 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 Business Financial Services has increased its dividend for 11 consecutive years.

Profitability

This table compares First Business Financial Services and Mid Penn Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Business Financial Services 17.84% 14.49% 1.17%
Mid Penn Bancorp 17.19% 9.19% 0.99%

Insider & Institutional Ownership

63.6% of First Business Financial Services shares are held by institutional investors. Comparatively, 42.2% of Mid Penn Bancorp shares are held by institutional investors. 6.3% of First Business Financial Services shares are held by company insiders. Comparatively, 10.3% of Mid Penn Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares First Business Financial Services and Mid Penn Bancorp’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Business Financial Services $141.69 million 2.16 $40.86 million $4.38 8.41
Mid Penn Bancorp $167.97 million 2.26 $54.81 million $2.54 8.98

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

Analyst Ratings

This is a summary of current recommendations and price targets for First Business Financial Services and Mid Penn Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Business Financial Services 0 0 2 0 3.00
Mid Penn Bancorp 0 0 1 0 3.00

First Business Financial Services currently has a consensus target price of $36.00, indicating a potential downside of 2.25%. Mid Penn Bancorp has a consensus target price of $32.00, indicating a potential upside of 40.23%. Given Mid Penn Bancorp’s higher possible upside, analysts plainly believe Mid Penn Bancorp is more favorable than First Business Financial Services.

Risk & Volatility

First Business Financial Services has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500. Comparatively, Mid Penn Bancorp has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500.

Summary

First Business Financial Services beats Mid Penn Bancorp on 9 of the 16 factors compared between the two stocks.

About First Business Financial Services

(Get Free Report)

First Business Financial Services, Inc. operates as the bank holding company for First Business Bank that provides commercial banking products and services for small and medium-sized businesses, business owners, executives, professionals, and high net worth individuals. It offers deposit products, such as non-interest-bearing transaction accounts, interest-bearing transaction accounts, money market accounts, time deposits, and certificates of deposit. The company also provides loan products, including commercial real estate loans, commercial and industrial loans, small business administration loans, and direct financing leases, as well as consumer and other loans comprising home equity, first and second mortgage, and other personal loans for professional and executive clients. It offers commercial lending, asset-based lending, equipment financing, accounts receivable financing, vendor financing, floorplan financing, treasury management services, and company retirement plans; trust and estate administration, financial planning, investment management, and private banking services; and investment portfolio administrative, asset-liability management, and asset-liability management process validation services for other financial institutions. The company was founded in 1909 and is headquartered in Madison, Wisconsin.

About Mid Penn Bancorp

(Get Free Report)

Mid Penn Bancorp, Inc. operates as the bank holding company for Mid Penn Bank that engages in the provision of commercial banking services to individuals, partnerships, non-profit organizations, and corporations. The company offers various time and demand deposit products, including checking accounts, savings accounts, clubs, money market deposit accounts, certificates of deposit, and individual retirement accounts. It also provides a range of loan products comprising mortgage and home equity loans, secured and unsecured commercial and consumer loans, lines of credit, construction financing, farm loans, community development loans, loans to non-profit entities, and local government loans. In addition, the company offers trust and wealth management and insurance services; provides online banking, telephone banking, cash management, and automated teller services, as well as safe deposit boxes. The company was founded in 1868 and is headquartered in Harrisburg, Pennsylvania.

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