Head to Head Analysis: Old National Bancorp (NASDAQ:ONB) and Lakeland Financial (NASDAQ:LKFN)

Old National Bancorp (NASDAQ:ONB) and Lakeland Financial (NASDAQ:LKFN) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.

Institutional and Insider Ownership

83.7% of Old National Bancorp shares are held by institutional investors. Comparatively, 81.2% of Lakeland Financial shares are held by institutional investors. 0.7% of Old National Bancorp shares are held by insiders. Comparatively, 3.0% of Lakeland Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Old National Bancorp and Lakeland Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Old National Bancorp	$3.74 billion	2.41	$669.26 million	$1.94	12.01
Lakeland Financial	$421.71 million	3.38	$103.36 million	$4.27	13.41

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

Profitability

This table compares Old National Bancorp and Lakeland Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Old National Bancorp	18.90%	11.23%	1.27%
Lakeland Financial	25.81%	14.79%	1.57%

Dividends

Old National Bancorp pays an annual dividend of $0.58 per share and has a dividend yield of 2.5%. Lakeland Financial pays an annual dividend of $2.08 per share and has a dividend yield of 3.6%. Old National Bancorp pays out 29.9% of its earnings in the form of a dividend. Lakeland Financial pays out 48.7% 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. Lakeland Financial has increased its dividend for 14 consecutive years. Lakeland Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Old National Bancorp has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500. Comparatively, Lakeland Financial has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Old National Bancorp and Lakeland Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Old National Bancorp	0	3	8	0	2.73
Lakeland Financial	0	3	1	0	2.25

Old National Bancorp currently has a consensus price target of $27.91, indicating a potential upside of 19.83%. Lakeland Financial has a consensus price target of $66.50, indicating a potential upside of 16.14%. Given Old National Bancorp’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Old National Bancorp is more favorable than Lakeland Financial.

Summary

Lakeland Financial beats Old National Bancorp on 9 of the 17 factors compared between the two stocks.

About Old National Bancorp

Old National Bancorp operates as the bank holding company for Old National Bank that provides various financial services to individual and commercial customers in the United States. It accepts deposit accounts, including noninterest-bearing demand, interest-bearing checking, negotiable order of withdrawal, savings and money market, and time deposits; and offers loans, such as home equity lines of credit, residential real estate loans, consumer loans, commercial loans, commercial real estate loans, agricultural loans, letters of credit, and lease financing. The company also provides debit and automated teller machine cards, telephone access, online banking, and other electronic and mobile banking services; cash management, private banking, brokerage, trust, investment advisory, and other traditional banking services; wealth management, investment, and foreign currency services; and treasury management, merchant, and capital markets services, as well as community development lending and equity investment solutions. The company was founded in 1834 and is headquartered in Evansville, Indiana.

About Lakeland Financial

Lakeland Financial Corporation operates as the bank holding company for Lake City Bank that provides various banking products and services in the United States. The company accepts various deposit products, such as noninterest bearing, interest-bearing checking, savings, money market, NOW, and demand deposits. Its loan products include commercial and industrial, commercial real estate and multi-family residential, construction, agri-business and agricultural, consumer 1-4 family mortgage, and other commercial and consumer loans. The company also provides retail and merchant credit card services; corporate treasury management, wealth advisory, and trust services; retail brokerage services, including various financial and investment products, such as annuities and life insurance; and mobile business banking and on-line treasury management services. It serves commercial real estate, manufacturing, agriculture, construction, retail, wholesale, finance and insurance, accommodation and food services, and health care industries. The company was founded in 1872 and is headquartered in Warsaw, Indiana.