Head-To-Head Survey: Financial Institutions (NASDAQ:FISI) versus CB Financial Services (NASDAQ:CBFV)

CB Financial Services (NASDAQ:CBFV) and Financial Institutions (NASDAQ:FISI) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Insider & Institutional Ownership

33.1% of CB Financial Services shares are owned by institutional investors. Comparatively, 60.5% of Financial Institutions shares are owned by institutional investors. 9.7% of CB Financial Services shares are owned by company insiders. Comparatively, 2.4% of Financial Institutions shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares CB Financial Services and Financial Institutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CB Financial Services	3.37%	8.49%	0.84%
Financial Institutions	-2.93%	11.27%	1.04%

Analyst Ratings

This is a breakdown of recent ratings and target prices for CB Financial Services and Financial Institutions, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CB Financial Services	0	2	1	0	2.33
Financial Institutions	0	2	2	0	2.50

CB Financial Services presently has a consensus price target of $36.00, indicating a potential upside of 8.01%. Financial Institutions has a consensus price target of $33.33, indicating a potential upside of 13.96%. Given Financial Institutions’ stronger consensus rating and higher possible upside, analysts plainly believe Financial Institutions is more favorable than CB Financial Services.

Risk and Volatility

CB Financial Services has a beta of 0.37, suggesting that its stock price is 63% less volatile than the S&P 500. Comparatively, Financial Institutions has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500.

Dividends

CB Financial Services pays an annual dividend of $1.04 per share and has a dividend yield of 3.1%. Financial Institutions pays an annual dividend of $1.24 per share and has a dividend yield of 4.2%. CB Financial Services pays out 216.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Financial Institutions pays out -90.5% of its earnings in the form of a dividend. Financial Institutions has raised its dividend for 1 consecutive years. Financial Institutions is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares CB Financial Services and Financial Institutions”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CB Financial Services	$39.21 million	4.26	$12.59 million	$0.48	69.44
Financial Institutions	$129.64 million	4.54	-$41.65 million	($1.37)	-21.35

CB Financial Services has higher earnings, but lower revenue than Financial Institutions. Financial Institutions is trading at a lower price-to-earnings ratio than CB Financial Services, indicating that it is currently the more affordable of the two stocks.

Summary

Financial Institutions beats CB Financial Services on 12 of the 17 factors compared between the two stocks.

About CB Financial Services

CB Financial Services, Inc. operates as the bank holding company for Community Bank that provides various banking products and services for individuals and businesses in southwestern Pennsylvania, West Virginia, and Ohio. The company's primary deposit products include demand deposits, NOW accounts, money market accounts, and savings accounts, as well as time deposit products. Its loan products comprise residential real estate loans, such as one- to four-family mortgage loans, home equity installment loans, and home equity lines of credit; commercial real estate loans that are secured primarily by improved properties, such as retail facilities, office buildings, and other non-residential buildings; construction loans to individuals to finance the construction of residential dwellings, as well as for the construction of commercial properties, including hotels, apartment buildings, housing developments, and owner-occupied properties used for businesses; commercial and industrial loans, and lines of credit; consumer loans consisting of indirect auto loans, secured and unsecured loans, and lines of credit; and other loans. In addition, the company conducts insurance agency activities by offering property and casualty, commercial liability, surety, and other insurance products. The company was founded in 1901 and is headquartered in Carmichaels, Pennsylvania.

About Financial Institutions

Financial Institutions, Inc. operates as a holding company for the Five Star Bank, a chartered bank that provides banking and financial services to individuals, municipalities, and businesses in New York. The company provides checking and savings account programs, including money market accounts, certificates of deposit, sweep investments, and individual retirement and other qualified plan accounts, as well as NOW accounts. Its loan products include term loans and lines of credit; short and medium-term commercial loans for working capital, business expansion, and purchase of equipment; commercial business loans to the agricultural industry; commercial mortgage loans; one-to-four family residential mortgage loans, home improvement loans, closed-end home equity loans, and home equity lines of credit; and consumer loans, such as automobile, secured installment, and personal loans. The company offers personal insurance products, including automobile, homeowners, boat, recreational vehicle, landlord, and umbrella coverage; commercial insurance comprising property, liability, automobile, inland marine, workers compensation, bonds, crop, and umbrella insurance products; and financial services, such as life and disability insurance, medicare supplements, long-term care, annuities, mutual funds, and retirement programs. In addition, it offers customized investment advisory, wealth management, investment consulting, and retirement plan services, as well as operates a real estate investment trust that holds residential mortgages and commercial real estate loans. Financial Institutions, Inc. was founded in 1817 and is headquartered in Warsaw, New York.