Head-To-Head Contrast: Northrim BanCorp (NASDAQ:NRIM) & Colony Bankcorp (NYSE:CBAN)

Northrim BanCorp (NASDAQ:NRIM) and Colony Bankcorp (NYSE:CBAN) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, profitability, institutional ownership, valuation and earnings.

Dividends

Northrim BanCorp pays an annual dividend of $0.68 per share and has a dividend yield of 2.8%. Colony Bankcorp pays an annual dividend of $0.48 per share and has a dividend yield of 2.4%. Northrim BanCorp pays out 27.5% of its earnings in the form of a dividend. Colony Bankcorp pays out 26.4% 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. Northrim BanCorp has raised its dividend for 16 consecutive years and Colony Bankcorp has raised its dividend for 7 consecutive years. Northrim BanCorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

66.0% of Northrim BanCorp shares are owned by institutional investors. Comparatively, 50.4% of Colony Bankcorp shares are owned by institutional investors. 2.4% of Northrim BanCorp shares are owned by insiders. Comparatively, 3.9% of Colony Bankcorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and target prices for Northrim BanCorp and Colony Bankcorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northrim BanCorp	0	2	2	0	2.50
Colony Bankcorp	0	1	3	0	2.75

Northrim BanCorp presently has a consensus target price of $29.50, indicating a potential upside of 22.74%. Colony Bankcorp has a consensus target price of $23.00, indicating a potential upside of 12.97%. Given Northrim BanCorp’s higher possible upside, equities research analysts clearly believe Northrim BanCorp is more favorable than Colony Bankcorp.

Risk & Volatility

Northrim BanCorp has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500. Comparatively, Colony Bankcorp has a beta of 0.57, meaning that its share price is 43% less volatile than the S&P 500.

Profitability

This table compares Northrim BanCorp and Colony Bankcorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northrim BanCorp	22.02%	16.01%	1.60%
Colony Bankcorp	16.71%	10.66%	1.11%

Valuation & Earnings

This table compares Northrim BanCorp and Colony Bankcorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northrim BanCorp	$221.66 million	2.41	$64.61 million	$2.47	9.73
Colony Bankcorp	$190.23 million	2.92	$28.25 million	$1.82	11.19

Northrim BanCorp has higher revenue and earnings than Colony Bankcorp. Northrim BanCorp is trading at a lower price-to-earnings ratio than Colony Bankcorp, indicating that it is currently the more affordable of the two stocks.

Summary

Northrim BanCorp beats Colony Bankcorp on 11 of the 17 factors compared between the two stocks.

About Northrim BanCorp

Northrim BanCorp is a bank holding company headquartered in Anchorage, Alaska, and the parent company of Northrim Bank. The bank was established in 1990 and serves individuals, businesses and organizations across Alaska. Northrim Bank provides commercial and consumer banking services, including deposit accounts, business and personal loans, mortgage lending, cash management and online banking. Its commercial offerings include financing for businesses and commercial real estate. The company also provides services such as equipment financing and invoice factoring through affiliated businesses.

About Colony Bankcorp

Colony Bankcorp, Inc. is the bank holding company for Colony Bank, a community bank serving individuals, businesses and organizations primarily in Georgia. Founded in 1975, the bank is headquartered in Fitzgerald, Georgia. Colony Bank offers personal and business deposit accounts, loans and other lending services, along with online and mobile banking. Its business banking services include commercial lending and cash management, while additional offerings include mortgage banking and wealth management services.