Solera National Bancorp (OTCMKTS:SLRK) & Associated Banc (NYSE:ASB) Critical Review

Associated Banc (NYSE:ASB) and Solera National Bancorp (OTCMKTS:SLRK) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, institutional ownership, valuation, risk and profitability.

Profitability

This table compares Associated Banc and Solera National Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Associated Banc	19.31%	10.25%	1.07%
Solera National Bancorp	28.36%	N/A	N/A

Risk and Volatility

Associated Banc has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Solera National Bancorp has a beta of 0.39, meaning that its stock price is 61% less volatile than the S&P 500.

Earnings and Valuation

This table compares Associated Banc and Solera National Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Associated Banc	$2.46 billion	1.80	$474.78 million	$2.77	9.65
Solera National Bancorp	$75.25 million	0.84	$18.07 million	$5.22	2.83

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

Insider and Institutional Ownership

83.0% of Associated Banc shares are owned by institutional investors. 1.1% of Associated Banc shares are owned by company insiders. Comparatively, 17.4% of Solera National Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Associated Banc and Solera National Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Associated Banc	0	8	3	0	2.27
Solera National Bancorp	0	0	0	0	0.00

Associated Banc currently has a consensus target price of $29.20, indicating a potential upside of 9.20%. Given Associated Banc’s stronger consensus rating and higher probable upside, equities analysts clearly believe Associated Banc is more favorable than Solera National Bancorp.

Summary

Associated Banc beats Solera National Bancorp on 11 of the 14 factors compared between the two stocks.

About Associated Banc

Associated Banc-Corp, a bank holding company, provides various banking and nonbanking products to individuals and businesses in Wisconsin, Illinois, and Minnesota. The company offers lending solutions, including commercial loans and lines of credit, commercial real estate financing, construction loans, letters of credit, leasing, asset based lending and equipment finance, loan syndications products, residential mortgages, home equity loans and lines of credit, personal and installment loans, auto finance and business loans, and business lines of credit. It also provides deposit and cash management solutions, such as commercial checking and interest-bearing deposit products, cash vault and night depository services, liquidity solutions, payables and receivables solutions, and information services; specialized financial services, such as interest rate risk management and foreign exchange solutions; fiduciary services, such as administration of pension, profit-sharing and other employee benefit plans, fiduciary and corporate agency services, and institutional asset management services; and investable funds solutions, including savings, money market deposit accounts, IRA accounts, CDs, fixed and variable annuities, full-service, discount, and online investment brokerage; investment advisory services; and trust and investment management accounts. In addition, the company offers deposit and transactional solutions, including checking, credit, debit and pre-paid cards, online banking and bill pay; and money transfer services. Associated Banc-Corp was founded in 1861 and is headquartered in Green Bay, Wisconsin.

About Solera National Bancorp

Solera National Bancorp, Inc. operates as the bank holding company for Solera National Bank that provides commercial and consumer banking services in the United States. The company offers checking and savings accounts, money market accounts, time and demand deposits, and individual retirement accounts (IRA), as well as certificates of deposit; and real estate secured loans, construction loans, small business administration loans, business lines of credit, and equipment financing. It also provides online banking, account analysis, combined account analysis, commercial sweep, remote deposit, ACH origination, payroll direct deposit, merchant, business debit card, and cash management services. The company was incorporated in 2006 and is based in Lakewood, Colorado.