Southern Michigan Bancorp (OTCMKTS:SOMC – Get Free Report) and FinWise Bancorp (NASDAQ:FINW – Get Free Report) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, risk, analyst recommendations, earnings and institutional ownership.
Profitability
This table compares Southern Michigan Bancorp and FinWise Bancorp’s net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
Southern Michigan Bancorp | 12.27% | 10.19% | 0.70% |
FinWise Bancorp | 14.78% | 8.75% | 2.33% |
Volatility & Risk
Southern Michigan Bancorp has a beta of 0.26, meaning that its share price is 74% less volatile than the S&P 500. Comparatively, FinWise Bancorp has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500.
Analyst Recommendations
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
Southern Michigan Bancorp | 0 | 0 | 0 | 0 | 0.00 |
FinWise Bancorp | 0 | 0 | 2 | 0 | 3.00 |
FinWise Bancorp has a consensus target price of $17.50, indicating a potential upside of 0.23%. Given FinWise Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe FinWise Bancorp is more favorable than Southern Michigan Bancorp.
Valuation and Earnings
This table compares Southern Michigan Bancorp and FinWise Bancorp”s top-line revenue, earnings per share (EPS) and valuation.
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
Southern Michigan Bancorp | $73.31 million | 1.14 | $10.90 million | $2.25 | 8.18 |
FinWise Bancorp | $85.61 million | 2.69 | $17.46 million | $1.06 | 16.47 |
FinWise Bancorp has higher revenue and earnings than Southern Michigan Bancorp. Southern Michigan Bancorp is trading at a lower price-to-earnings ratio than FinWise Bancorp, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
35.4% of FinWise Bancorp shares are owned by institutional investors. 19.2% of FinWise Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Summary
FinWise Bancorp beats Southern Michigan Bancorp on 12 of the 14 factors compared between the two stocks.
About Southern Michigan Bancorp
Southern Michigan Bancorp, Inc. operates as the bank holding company for Southern Michigan Bank & Trust that provides a range of commercial banking services to individuals, businesses, institutions, and governmental agencies primarily in the southwest Michigan communities. Its deposit products include interest and non-interest checking, savings, and various types of money market accounts; time, savings, and demand deposits; and certificates of deposit and IRAs. The company also provides home mortgages and equity loans, home equity lines of credit, VA and FHA home loans, USDA rural development loans, and auto/personal loans; business loans, such as lines of credit, term loans, commercial real estate loans, commercial and industrial loans, agriculture loans, letters of credit, small business administration loans, and capital access loans; industrial, construction, real estate, and inventory loans; and consumer lending products comprising direct and indirect loans to purchasers of residential real property and consumer goods. In addition, it offers trust and investment services that include investment management, trustee, IRA rollovers and retirement plan, institutional and personal custody, estate settlement, wealth management, estate and wealth transfer planning assistance, charitable gift planning assistance, and cash management custody services; and safe deposit box and automated teller machine services. Further, the company provides bill pay, e-statements, ACH, wire transfer, remote deposit capture, and insurance services, as well as ATM, debit, credit, and gift cards. The company was founded in 1871 and is based in Coldwater, Michigan.
About FinWise Bancorp
FinWise Bancorp operates as the bank holding company for FinWise Bank that provides various banking products and services to individual and corporate customers in Utah. The company offers various deposit products, including interest and noninterest bearing demand accounts, health savings account demand deposits, NOW and money market accounts, and checking and savings accounts, as well as time deposits and certificates of deposits. It also provides loans, including consumer, small business administration, commercial, commercial real estate, and residential real estate loans. In addition, the company offers debit cards, remote deposit capture, online banking, mobile banking, and direct deposit services; and business accounts and cash management services, such as business checking and savings accounts, and treasury services. FinWise Bancorp was founded in 1999 and is headquartered in Murray, Utah.
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