Critical Analysis: Finward Bancorp (NASDAQ:FNWD) versus Auburn National Bancorporation (NASDAQ:AUBN)

Finward Bancorp (NASDAQ:FNWD) and Auburn National Bancorporation (NASDAQ:AUBN) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Institutional and Insider Ownership

26.6% of Finward Bancorp shares are held by institutional investors. Comparatively, 39.5% of Auburn National Bancorporation shares are held by institutional investors. 13.1% of Finward Bancorp shares are held by insiders. Comparatively, 18.7% of Auburn National Bancorporation shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Finward Bancorp and Auburn National Bancorporation”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Finward Bancorp	$101.06 million	1.84	$8.09 million	$2.27	18.96
Auburn National Bancorporation	$34.26 million	2.75	$7.26 million	$2.41	11.20

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

Volatility & Risk

Finward Bancorp has a beta of 0.15, indicating that its stock price is 85% less volatile than the S&P 500. Comparatively, Auburn National Bancorporation has a beta of 0.43, indicating that its stock price is 57% less volatile than the S&P 500.

Dividends

Finward Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 1.1%. Auburn National Bancorporation pays an annual dividend of $1.08 per share and has a dividend yield of 4.0%. Finward Bancorp pays out 21.1% of its earnings in the form of a dividend. Auburn National Bancorporation pays out 44.8% 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.

Profitability

This table compares Finward Bancorp and Auburn National Bancorporation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Finward Bancorp	9.65%	5.68%	0.48%
Auburn National Bancorporation	18.60%	9.10%	0.81%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Finward Bancorp and Auburn National Bancorporation, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Finward Bancorp	0	1	2	0	2.67
Auburn National Bancorporation	0	1	0	0	2.00

Finward Bancorp currently has a consensus price target of $41.00, suggesting a potential downside of 4.75%. Given Finward Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe Finward Bancorp is more favorable than Auburn National Bancorporation.

Summary

Auburn National Bancorporation beats Finward Bancorp on 9 of the 16 factors compared between the two stocks.

About Finward Bancorp

Finward Bancorp operates as the holding company for Peoples Bank that provides various banking products and services. The company’s deposit products include non-interest- and interest-bearing demand accounts, savings accounts, money market deposit accounts, certificate accounts, and retirement savings plans. Its loan products portfolio comprises residential mortgage loans that enable borrowers to purchase existing homes, refinance existing homes, or construct new homes; construction loans primarily to individuals and contractors; commercial real estate loans; consumer loans to individuals for personal, household, or family purposes; home equity line of credit; home improvement loans and equity loans; commercial business loans; government loans; and loans to municipalities. The company also offers estate and retirement planning, custodial services, guardianships, IRA accounts, and investment agency accounts, as well as serves as the personal representative of estates, and acts as trustee for revocable and irrevocable trusts. In addition, it provides insurance and annuity investments to wealth management customers; holds real estate properties; and operates as a real estate investment trust. The company was formerly known as NorthWest Indiana Bancorp and changed its name to Finward Bancorp in May 2021. Finward Bancorp was founded in 1916 and is headquartered in Munster, Indiana.

About Auburn National Bancorporation

Auburn National Bancorporation, Inc. operates as the bank holding company for AuburnBank that provides various banking products and services in East Alabama. The company offers checking, savings, and transaction deposit accounts, as well as certificates of deposit. It also provides commercial, financial, agricultural, real estate construction, and consumer loan products; and other financial services. In addition, the company offers automated teller services; debit cards; online banking, bill payment, and other electronic banking services; and safe deposit boxes. Auburn National Bancorporation, Inc. was founded in 1907 and is headquartered in Auburn, Alabama.