Critical Review: 1st Source (SRCE) vs. Its Competitors

1st Source (NASDAQ:SRCE) is one of 919 publicly-traded companies in the “Banks” industry, but how does it compare to its competitors? We will compare 1st Source to similar companies based on the strength of its dividends, institutional ownership, valuation, profitability, risk, analyst recommendations and earnings.

Earnings and Valuation

This table compares 1st Source and its competitors top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
1st Source	$462.41 million	$158.28 million	11.89
1st Source Competitors	$37.93 billion	$2.42 billion	21.02

1st Source’s competitors have higher revenue and earnings than 1st Source. 1st Source is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a summary of recent recommendations for 1st Source and its competitors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
1st Source	0	3	1	1	2.60
1st Source Competitors	7503	30277	27877	1492	2.35

1st Source presently has a consensus target price of $91.67, indicating a potential upside of 4.01%. As a group, “Banks” companies have a potential upside of 14.46%. Given 1st Source’s competitors higher possible upside, analysts clearly believe 1st Source has less favorable growth aspects than its competitors.

Profitability

This table compares 1st Source and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
1st Source	28.85%	13.57%	1.97%
1st Source Competitors	15.66%	9.47%	0.93%

Insider & Institutional Ownership

74.4% of 1st Source shares are owned by institutional investors. Comparatively, 48.0% of shares of all “Banks” companies are owned by institutional investors. 20.2% of 1st Source shares are owned by insiders. Comparatively, 9.7% of shares of all “Banks” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

1st Source has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, 1st Source’s competitors have a beta of 0.62, suggesting that their average stock price is 38% less volatile than the S&P 500.

Dividends

1st Source pays an annual dividend of $1.80 per share and has a dividend yield of 2.0%. 1st Source pays out 24.3% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 8.9% and pay out 28.9% of their earnings in the form of a dividend. 1st Source has raised its dividend for 38 consecutive years.

Summary

1st Source beats its competitors on 8 of the 15 factors compared.

1st Source Company Profile

1st Source Corporation is a bank holding company headquartered in South Bend, Indiana. Through 1st Source Bank and its affiliated businesses, the company provides commercial and consumer banking services, including deposits, loans, cash management and wealth management. The company also operates specialty finance businesses that provide financing for aircraft, construction equipment, vehicles and other commercial assets. These services extend beyond its regional banking footprint to customers in a range of U.S. markets.