Critical Survey: CNB Financial (NASDAQ:CCNE) and Esquire Financial (NASDAQ:ESQ)

CNB Financial (NASDAQ:CCNE) and Esquire Financial (NASDAQ:ESQ) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, valuation, profitability, analyst recommendations, earnings, institutional ownership and dividends.

Dividends

CNB Financial pays an annual dividend of $0.76 per share and has a dividend yield of 2.3%. Esquire Financial pays an annual dividend of $0.80 per share and has a dividend yield of 0.7%. CNB Financial pays out 27.0% of its earnings in the form of a dividend. Esquire Financial pays out 13.4% 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. CNB Financial has increased its dividend for 1 consecutive years and Esquire Financial has increased its dividend for 4 consecutive years.

Valuation & Earnings

This table compares CNB Financial and Esquire Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CNB Financial	$432.51 million	2.31	$66.13 million	$2.81	11.99
Esquire Financial	$164.50 million	6.32	$50.82 million	$5.95	20.23

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

Profitability

This table compares CNB Financial and Esquire Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CNB Financial	17.62%	12.14%	1.16%
Esquire Financial	29.96%	18.30%	2.30%

Risk & Volatility

CNB Financial has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500. Comparatively, Esquire Financial has a beta of 0.39, suggesting that its share price is 61% less volatile than the S&P 500.

Institutional & Insider Ownership

52.3% of CNB Financial shares are held by institutional investors. Comparatively, 54.7% of Esquire Financial shares are held by institutional investors. 2.9% of CNB Financial shares are held by company insiders. Comparatively, 13.9% of Esquire Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings and recommmendations for CNB Financial and Esquire Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CNB Financial	0	2	2	1	2.80
Esquire Financial	0	1	2	1	3.00

CNB Financial currently has a consensus price target of $34.33, suggesting a potential upside of 1.91%. Esquire Financial has a consensus price target of $120.33, suggesting a potential downside of 0.01%. Given CNB Financial’s higher probable upside, research analysts clearly believe CNB Financial is more favorable than Esquire Financial.

Summary

Esquire Financial beats CNB Financial on 11 of the 16 factors compared between the two stocks.

About CNB Financial

CNB Financial Corporation operates as the bank holding company for CNB Bank that provides a range of banking products and services for individual, business, governmental, and institutional customers. The company accepts checking, savings, and time deposit accounts; and offers real estate, commercial, industrial, residential, and consumer loans, as well as various other specialized financial services. It also provides private banking; and wealth and asset management services, including the administration of trusts and estates, retirement plans, and other employee benefit plans, as well as a range of wealth management services. In addition, the company invests in debt and equity securities; sells nonproprietary annuities and other insurance products; and offers small balance unsecured loans and secured loans primarily collateralized by automobiles and equipment, as well as engages in consumer discount loan and finance business. The company was founded in 1865 and is headquartered in Clearfield, Pennsylvania.

About Esquire Financial

Esquire Financial Holdings, Inc. operates as the bank holding company for Esquire Bank, National Association that provides commercial banking products and services to legal industry and small businesses, and commercial and retail customers in the United States. The company offers checking, savings, money market, and time deposits, as well as certificates of deposit. It also provides commercial loans, such as short-term financing for inventory, receivables, the purchase of supplies, or other operating needs arising during the normal course of business, as well as loans to its qualified ISO customers; commercial lines of credit; consumer loans consisting of post-settlement consumer and structured settlement loans to plaintiffs and claimants, as well as loans to individuals for debt consolidation, medical expenses, living expenses, payment of outstanding bills, or other consumer needs; and real estate loans, such as multifamily, 1-4 family residential, commercial real estate, and construction loans, as well as merchant services. In addition, it offers cash management, cash sweep, online and mobile banking, individual retirement accounts, and working capital lines of credit. Esquire Financial Holdings, Inc. was founded in 2006 and is headquartered in Jericho, New York.