Financial Institutions (NASDAQ:FISI – Get Free Report) and Peapack-Gladstone Financial (NASDAQ:PGC – Get Free Report) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, dividends, institutional ownership, analyst recommendations and earnings.
Risk & Volatility
Financial Institutions has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500. Comparatively, Peapack-Gladstone Financial has a beta of 0.71, suggesting that its share price is 29% less volatile than the S&P 500.
Valuation and Earnings
This table compares Financial Institutions and Peapack-Gladstone Financial”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Financial Institutions | $254.18 million | 3.30 | $74.87 million | $4.03 | 10.57 |
| Peapack-Gladstone Financial | $444.61 million | 1.85 | $37.33 million | $2.88 | 16.08 |
Financial Institutions has higher earnings, but lower revenue than Peapack-Gladstone Financial. Financial Institutions is trading at a lower price-to-earnings ratio than Peapack-Gladstone Financial, indicating that it is currently the more affordable of the two stocks.
Dividends
Financial Institutions pays an annual dividend of $1.28 per share and has a dividend yield of 3.0%. Peapack-Gladstone Financial pays an annual dividend of $0.20 per share and has a dividend yield of 0.4%. Financial Institutions pays out 31.8% of its earnings in the form of a dividend. Peapack-Gladstone Financial pays out 6.9% 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. 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.
Profitability
This table compares Financial Institutions and Peapack-Gladstone Financial’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Financial Institutions | 21.78% | 13.54% | 1.31% |
| Peapack-Gladstone Financial | 11.09% | 7.91% | 0.69% |
Institutional and Insider Ownership
60.5% of Financial Institutions shares are owned by institutional investors. Comparatively, 72.8% of Peapack-Gladstone Financial shares are owned by institutional investors. 2.4% of Financial Institutions shares are owned by insiders. Comparatively, 5.8% of Peapack-Gladstone Financial shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Analyst Ratings
This is a summary of recent ratings and price targets for Financial Institutions and Peapack-Gladstone Financial, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Financial Institutions | 0 | 2 | 2 | 0 | 2.50 |
| Peapack-Gladstone Financial | 0 | 1 | 3 | 1 | 3.00 |
Financial Institutions presently has a consensus target price of $45.00, suggesting a potential upside of 5.66%. Peapack-Gladstone Financial has a consensus target price of $56.33, suggesting a potential upside of 21.62%. Given Peapack-Gladstone Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Peapack-Gladstone Financial is more favorable than Financial Institutions.
Summary
Peapack-Gladstone Financial beats Financial Institutions on 10 of the 18 factors compared between the two stocks.
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.
About Peapack-Gladstone Financial
Peapack-Gladstone Financial Corporation operates as the bank holding company for Peapack-Gladstone Bank that provides private banking and wealth management services in the United States. The company operates in two segments, Banking and Peapack Private. It offers checking and savings accounts, money market and interest-bearing checking accounts, certificates of deposit, and individual retirement accounts. The company also provides working capital lines of credit, term loans for fixed asset acquisitions, commercial mortgages, multi-family mortgages, and other forms of asset-based financing services; and residential mortgages, home equity lines of credit, and other second mortgage loans. In addition, it offers corporate and industrial (C&I) and equipment finance, commercial real estate, multifamily, residential, and consumer lending activities; treasury management services; C&I advisory services; escrow management; deposit generation; investment management services; personal trust services, including services as executor, trustee, administrator, custodian, and guardian; and other financial planning, tax preparation, and advisory services. Further, the company provides telephone and Internet banking, merchant credit card, and customer support sales services. Its private banking clients include businesses, non-profits, and consumers; wealth management clients comprise individuals, families, foundations, endowments, trusts, and estates; and commercial loan clients include business owners, professionals, retailers, contractors, and real estate investors. The company operates its private banking locations in Bedminster, Morristown, Princeton, and Teaneck, New Jersey; and branches in Somerset, Morris, Hunterdon, and Union counties, as well as operates automated teller machines. Peapack-Gladstone Financial Corporation was founded in 1921 and is headquartered in Bedminster, New Jersey.
Receive News & Ratings for Financial Institutions Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Financial Institutions and related companies with MarketBeat.com's FREE daily email newsletter.
