Head-To-Head Review: Enterprise Financial Services (NASDAQ:EFSC) & Parke Bancorp (NASDAQ:PKBK)

Parke Bancorp (NASDAQ:PKBK) and Enterprise Financial Services (NASDAQ:EFSC) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, analyst recommendations, dividends, valuation, profitability and institutional ownership.

Analyst Recommendations

This is a breakdown of current recommendations for Parke Bancorp and Enterprise Financial Services, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Parke Bancorp	0	0	1	0	3.00
Enterprise Financial Services	0	1	4	0	2.80

Enterprise Financial Services has a consensus price target of $70.00, indicating a potential upside of 12.65%. Given Enterprise Financial Services’ higher probable upside, analysts plainly believe Enterprise Financial Services is more favorable than Parke Bancorp.

Risk and Volatility

Parke Bancorp has a beta of 0.47, suggesting that its share price is 53% less volatile than the S&P 500. Comparatively, Enterprise Financial Services has a beta of 0.78, suggesting that its share price is 22% less volatile than the S&P 500.

Earnings and Valuation

This table compares Parke Bancorp and Enterprise Financial Services”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Parke Bancorp	$146.08 million	2.76	$37.78 million	$3.84	8.92
Enterprise Financial Services	$1.00 billion	2.25	$201.37 million	$5.03	12.35

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

Profitability

This table compares Parke Bancorp and Enterprise Financial Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Parke Bancorp	29.99%	13.88%	2.05%
Enterprise Financial Services	18.72%	9.70%	1.11%

Dividends

Parke Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 2.3%. Enterprise Financial Services pays an annual dividend of $1.40 per share and has a dividend yield of 2.3%. Parke Bancorp pays out 20.8% of its earnings in the form of a dividend. Enterprise Financial Services pays out 27.8% 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. Enterprise Financial Services has raised its dividend for 11 consecutive years. Parke Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

49.7% of Parke Bancorp shares are owned by institutional investors. Comparatively, 72.2% of Enterprise Financial Services shares are owned by institutional investors. 13.0% of Parke Bancorp shares are owned by company insiders. Comparatively, 2.2% of Enterprise Financial Services shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Enterprise Financial Services beats Parke Bancorp on 9 of the 17 factors compared between the two stocks.

About Parke Bancorp

Parke Bancorp, Inc. operates as the bank holding company for Parke Bank that provides personal and business financial services to individuals and small to mid-sized businesses. The company offers various deposit products, including checking, savings, time, money market, and individual retirement accounts, as well as certificates of deposit. Its loan portfolio comprises commercial and industrial, construction, commercial and residential real estate mortgage, and consumer loans. In addition, the company provides debit cards, internet banking, and online bill payment services. Parke Bancorp, Inc. was founded in 1999 and is headquartered in Washington Township, New Jersey.

About Enterprise Financial Services

Enterprise Financial Services Corp operates as the holding company for Enterprise Bank & Trust that offers banking and wealth management services to individuals and corporate customers primarily in Arizona, California, Florida, Kansas, Missouri, Nevada, and New Mexico. It provides checking, savings, money market accounts, and certificates of deposit. The company also provides commercial and industrial, commercial real estate, real estate construction and development, residential real estate, small business administration, agricultural, consumer, and other loan products. In addition, it offers treasury management and international trade services; tax credit brokerage services; life insurance premium and sponsor finance; tax credit related lending; other deposit accounts, such as community associations, property management, third party escrow, and trust services; treasury management product and services; customized solutions and products; cash management; fiduciary, investment management, and financial advisory services; and customer hedging products, including international banking, card services, and tax credit businesses. Further, the company provides online, device applications, text, and voice banking; remote deposit capture; internet banking, mobile banking, cash management, positive pay services, fraud detection and prevention, automated payables, check image, and statement and document imaging; and controlled disbursements, repurchase agreements, and sweep investment accounts. Enterprise Financial Services Corp was founded in 1988 and is headquartered in Clayton, Missouri.