Comparing Citizens & Northern (NASDAQ:CZNC) & Metropolitan Bank (NYSE:MCB)

Metropolitan Bank (NYSE:MCB) and Citizens & Northern (NASDAQ:CZNC) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, earnings, profitability, dividends, risk, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations and price targets for Metropolitan Bank and Citizens & Northern, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Metropolitan Bank	0	1	2	1	3.00
Citizens & Northern	0	4	0	0	2.00

Metropolitan Bank currently has a consensus target price of $103.00, suggesting a potential upside of 14.12%. Citizens & Northern has a consensus target price of $23.50, suggesting a potential upside of 1.38%. Given Metropolitan Bank’s stronger consensus rating and higher possible upside, analysts plainly believe Metropolitan Bank is more favorable than Citizens & Northern.

Profitability

This table compares Metropolitan Bank and Citizens & Northern’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Metropolitan Bank	14.31%	10.72%	1.03%
Citizens & Northern	9.67%	7.47%	0.81%

Risk & Volatility

Metropolitan Bank has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.Comparatively, Citizens & Northern has a beta of 0.41, indicating that its stock price is 59% less volatile than the S&P 500.

Institutional & Insider Ownership

79.8% of Metropolitan Bank shares are held by institutional investors. Comparatively, 30.8% of Citizens & Northern shares are held by institutional investors. 5.5% of Metropolitan Bank shares are held by company insiders. Comparatively, 4.7% of Citizens & Northern shares are held 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.

Earnings & Valuation

This table compares Metropolitan Bank and Citizens & Northern”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Metropolitan Bank	$527.15 million	2.12	$71.10 million	$8.12	11.11
Citizens & Northern	$170.03 million	2.44	$23.43 million	$1.09	21.27

Metropolitan Bank has higher revenue and earnings than Citizens & Northern. Metropolitan Bank is trading at a lower price-to-earnings ratio than Citizens & Northern, indicating that it is currently the more affordable of the two stocks.

Dividends

Metropolitan Bank pays an annual dividend of $1.00 per share and has a dividend yield of 1.1%. Citizens & Northern pays an annual dividend of $1.12 per share and has a dividend yield of 4.8%. Metropolitan Bank pays out 12.3% of its earnings in the form of a dividend. Citizens & Northern pays out 102.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Metropolitan Bank beats Citizens & Northern on 14 of the 17 factors compared between the two stocks.

About Metropolitan Bank

Metropolitan Bank Holding Corp. operates as the bank holding company for Metropolitan Commercial Bank that provides a range of business, commercial, and retail banking products and services to small businesses, middle-market enterprises, public entities, and individuals in the New York metropolitan area. The company offers checking, savings, term deposit, money market, demand deposit, and other interest-bearing transaction accounts. It also provides lending products, including commercial real estate, multi-family, construction, and one-to four-family real estate loans; commercial and industrial loans; consumer loans; acquisition and renovation loans; loans to refinance or return borrower equity; loans on owner-occupied properties; working capital lines of credit; trade finance and letters of credit; and term loans. In addition, the company offers cash management services, as well as online and mobile banking, ACH, remote deposit capture, and debit cards. The company was formerly known as Metbank Holding Corp. and changed its name to Metropolitan Bank Holding Corp. in January 2007. Metropolitan Bank Holding Corp. was incorporated in 1997 and is headquartered in New York, New York.

About Citizens & Northern

Citizens & Northern Corp. is a holding company, which engages in community banking. It provides a full range of banking and mortgage services to individual and corporate customers in North Central Pennsylvania and Southern New York State. The firm’s lending products include mortgage loans, commercial loans, and consumer loans. Its deposit products include various types of checking accounts, passbook and statement savings, money market accounts, interest checking accounts, individual retirement accounts, and certificates of deposit. The company was founded in 1864 and is headquartered in Wellsboro, PA.