Financial Survey: AmeriServ Financial (NASDAQ:ASRV) versus Washington Trust Bancorp (NASDAQ:WASH)

AmeriServ Financial (NASDAQ:ASRV) and Washington Trust Bancorp (NASDAQ:WASH) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.

Institutional and Insider Ownership

31.5% of AmeriServ Financial shares are owned by institutional investors. Comparatively, 65.8% of Washington Trust Bancorp shares are owned by institutional investors. 7.9% of AmeriServ Financial shares are owned by company insiders. Comparatively, 1.3% of Washington Trust Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for AmeriServ Financial and Washington Trust Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AmeriServ Financial	0	0	1	0	3.00
Washington Trust Bancorp	1	2	1	0	2.00

Washington Trust Bancorp has a consensus target price of $33.00, indicating a potential downside of 6.28%. Given Washington Trust Bancorp’s higher probable upside, analysts clearly believe Washington Trust Bancorp is more favorable than AmeriServ Financial.

Risk & Volatility

AmeriServ Financial has a beta of 0.45, indicating that its share price is 55% less volatile than the S&P 500. Comparatively, Washington Trust Bancorp has a beta of 0.74, indicating that its share price is 26% less volatile than the S&P 500.

Valuation and Earnings

This table compares AmeriServ Financial and Washington Trust Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AmeriServ Financial	$88.34 million	0.72	$5.61 million	$0.33	11.39
Washington Trust Bancorp	$393.95 million	1.70	$52.24 million	$2.73	12.90

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

Profitability

This table compares AmeriServ Financial and Washington Trust Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AmeriServ Financial	6.20%	4.72%	0.38%
Washington Trust Bancorp	13.71%	9.79%	0.79%

Dividends

AmeriServ Financial pays an annual dividend of $0.12 per share and has a dividend yield of 3.2%. Washington Trust Bancorp pays an annual dividend of $2.24 per share and has a dividend yield of 6.4%. AmeriServ Financial pays out 36.4% of its earnings in the form of a dividend. Washington Trust Bancorp pays out 82.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Washington Trust Bancorp beats AmeriServ Financial on 12 of the 15 factors compared between the two stocks.

About AmeriServ Financial

AmeriServ Financial, Inc. is a holding company, which engages in the provision of consumer, mortgage and commercial financial products and services through its subsidiary. It operates through the following segments: Community Banking, Wealth Management, and Investment or Parent. The Community Banking segment includes both retail and commercial banking activities. The Wealth Management segment involves in the operations of a Trust Company, West Chester Capital Advisors an investment advisory firm, and Financial Services. The Investment or Parent segment offers investment securities, borrowing activities, and general corporate expenses. The company was founded in January 1983 and is headquartered in Johnstown, PA.

About Washington Trust Bancorp

Washington Trust Bancorp, Inc. operates as the bank holding company for The Washington Trust Company, of Westerly that provides various banking and financial services to individuals and businesses. The company operates in two segments, Commercial Banking and Wealth Management Services. The Commercial Banking segment offers deposit accounts, including interest-bearing and noninterest-bearing demand deposits, NOW and savings accounts, money market and retirement deposit accounts, and time deposits; various commercial and retail lending products, such as commercial real estate loans, including commercial mortgages, and construction and development loans; commercial and industrial loans comprising working capital, equipment financing, and financing for other business-related purposes; residential real estate loans that consist of mortgage and homeowner construction loans; and consumer loans comprising home equity loans and lines of credit, personal installment loans, and loans to individuals secured by general aviation aircraft. This segment also provides debit cards; automated teller machines (ATMs); telephone banking, internet banking, mobile banking, remote deposit capture, and other cash management services; and investment portfolio and wholesale funding services. The Wealth Management Services segment offers investment management; financial planning; personal trust and estate services, such as trustee, personal representative, custodian, and guardian; and settlement of decedents’ estates, as well as institutional trust services comprising custody and fiduciary services for personal and institutional clients. Washington Trust Bancorp, Inc. was founded in 1800 and is headquartered in Westerly, Rhode Island.