Critical Analysis: First Northern Community Bancorp (OTCMKTS:FNRN) and Columbia Banking System (NASDAQ:COLB)

First Northern Community Bancorp (OTCMKTS:FNRN) and Columbia Banking System (NASDAQ:COLB) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, earnings, institutional ownership, risk, dividends and valuation.

Risk and Volatility

First Northern Community Bancorp has a beta of 0.23, meaning that its share price is 77% less volatile than the S&P 500. Comparatively, Columbia Banking System has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500.

Insider & Institutional Ownership

17.9% of First Northern Community Bancorp shares are held by institutional investors. Comparatively, 92.5% of Columbia Banking System shares are held by institutional investors. 11.8% of First Northern Community Bancorp shares are held by insiders. Comparatively, 0.7% of Columbia Banking System shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings for First Northern Community Bancorp and Columbia Banking System, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Northern Community Bancorp	0	0	0	0	0.00
Columbia Banking System	0	12	3	1	2.31

Columbia Banking System has a consensus price target of $29.38, indicating a potential upside of 9.11%. Given Columbia Banking System’s stronger consensus rating and higher possible upside, analysts plainly believe Columbia Banking System is more favorable than First Northern Community Bancorp.

Profitability

This table compares First Northern Community Bancorp and Columbia Banking System’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Northern Community Bancorp	23.58%	11.03%	1.08%
Columbia Banking System	17.98%	11.31%	1.15%

Valuation and Earnings

This table compares First Northern Community Bancorp and Columbia Banking System”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Northern Community Bancorp	$84.67 million	2.45	$20.03 million	$1.31	10.06
Columbia Banking System	$2.07 billion	3.89	$533.67 million	$2.22	12.13

Columbia Banking System has higher revenue and earnings than First Northern Community Bancorp. First Northern Community Bancorp is trading at a lower price-to-earnings ratio than Columbia Banking System, indicating that it is currently the more affordable of the two stocks.

Summary

Columbia Banking System beats First Northern Community Bancorp on 13 of the 15 factors compared between the two stocks.

About First Northern Community Bancorp

First Northern Community Bancorp operates as the bank holding company for First Northern Bank of Dixon that provides commercial banking products and services to individuals, and small and medium sized businesses. The company accepts demand deposits, interest-bearing transaction deposits, savings and money market deposit accounts, and time deposits. It also offers commercial, commercial real estate, agriculture, residential mortgage, residential construction, and consumer loans. In addition, the company provides debit and credit cards; investment and brokerage services; alternative investment products, and fiduciary and other financial services; and equipment leasing, merchant card processing, payroll, and international banking services through third parties. Further, it offers cashier's checks, safe deposit boxes, and other customary banking services. The company operates branches located in the cities of Auburn, Colusa, Davis, Dixon, Fairfield, Orland, Rancho Cordova, Roseville, Sacramento, Vacaville, West Sacramento, Winters, Willows, and Woodland; satellite banking office inside a retirement community in the city of Davis; residential mortgage loan office in Davis; and commercial loan office in the Contra Costa County city of Walnut Creek. First Northern Community Bancorp was founded in 1910 and is headquartered in Dixon, California.

About Columbia Banking System

Columbia Banking System, Inc. operates as the holding company of Umpqua Bank that provides banking, private banking, mortgage, and other financial services in the United States. The company offers deposit products, including business, non-interest bearing checking, interest-bearing checking and savings, money market, and certificate of deposit accounts; and insured cash sweep and other investment sweep solutions. It also provides commercial lending products, such as commercial lines of credit and term loans, accounts receivable and inventory financing, international trade finance, commercial property loans, multifamily loans, equipment loans, commercial equipment leases, real estate construction loans and permanent financing, and small business administration program financing, as well as capital markets. In addition, the company offers wealth management comprising financial planning, investment, trust, and insurance; treasury management, which includes digital and mobile banking solutions, ACH, wires, positive pay, remote deposit capture, integrated payments, integrated receivables, lockbox, cash vault, real-time payments, commercial card, and foreign exchange and international banking related products, as well as merchant services; and brokerage services, residential real estate loans and consumer loans. It serves its products to corporate, institutional, small business, and individual customers. The company was founded in 1953 and is headquartered in Tacoma, Washington.