Critical Contrast: Old National Bancorp (NASDAQ:ONB) and Evans Bancorp (NYSE:EVBN)

Old National Bancorp (NASDAQ:ONB) and Evans Bancorp (NYSE:EVBN) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, earnings, valuation, risk and dividends.

Profitability

This table compares Old National Bancorp and Evans Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Old National Bancorp	18.24%	10.13%	1.13%
Evans Bancorp	9.89%	6.66%	0.53%

Institutional and Insider Ownership

83.7% of Old National Bancorp shares are held by institutional investors. Comparatively, 67.1% of Evans Bancorp shares are held by institutional investors. 0.9% of Old National Bancorp shares are held by insiders. Comparatively, 6.3% of Evans Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility and Risk

Old National Bancorp has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500. Comparatively, Evans Bancorp has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Old National Bancorp and Evans Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Old National Bancorp	0	1	6	2	3.11
Evans Bancorp	0	0	0	0	0.00

Old National Bancorp currently has a consensus target price of $25.67, indicating a potential upside of 15.98%. Given Old National Bancorp’s stronger consensus rating and higher probable upside, research analysts plainly believe Old National Bancorp is more favorable than Evans Bancorp.

Dividends

Old National Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 2.5%. Evans Bancorp pays an annual dividend of $1.32 per share and has a dividend yield of 3.3%. Old National Bancorp pays out 32.6% of its earnings in the form of a dividend. Evans Bancorp pays out 61.4% 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.

Earnings and Valuation

This table compares Old National Bancorp and Evans Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Old National Bancorp	$1.93 billion	3.66	$539.19 million	$1.72	12.87
Evans Bancorp	$69.21 million	3.18	$11.95 million	$2.15	18.39

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

Summary

Old National Bancorp beats Evans Bancorp on 13 of the 17 factors compared between the two stocks.

About Old National Bancorp

Old National Bancorp operates as the bank holding company for Old National Bank that provides various financial services to individual and commercial customers in the United States. It accepts deposit accounts, including noninterest-bearing demand, interest-bearing checking, negotiable order of withdrawal, savings and money market, and time deposits; and offers loans, such as home equity lines of credit, residential real estate loans, consumer loans, commercial loans, commercial real estate loans, agricultural loans, letters of credit, and lease financing. The company also provides debit and automated teller machine cards, telephone access, online banking, and other electronic and mobile banking services; cash management, private banking, brokerage, trust, investment advisory, and other traditional banking services; wealth management, investment, and foreign currency services; and treasury management, merchant, and capital markets services, as well as community development lending and equity investment solutions. The company was founded in 1834 and is headquartered in Evansville, Indiana.

About Evans Bancorp

Evans Bancorp, Inc. primarily operates as the financial holding company for Evans Bank, N.A. that provides a range of banking products and services to consumer and commercial customers in Western New York and the Finger Lakes Region of New York State. It operates in two segments, Banking Activities and Insurance Agency Activities. The company offers deposit products, which include checking and negotiable order of withdrawal accounts, savings accounts, and certificates of deposit. It also provides residential mortgages; commercial and multi-family mortgages and commercial construction loans; home equities, such as home equity lines of credit and second mortgage loans; commercial and industrial loans comprising term loans and lines of credit; consumer loans, including direct automobile, recreational vehicle, boat, home improvement, and personal loans; other loans consisting of cash reserves, overdrafts, and loan clearing accounts; and installment loans. In addition, the company sells various premium-based insurance policies, including business and personal insurance, employee benefits, surety bonds, risk management, life, disability, and long-term care coverage, as well as provides claims adjusting services to various insurance companies; and non-deposit investment products, such as annuities and mutual funds. It operates through a total of 21 full-service banking offices in Erie County, Niagara County, Monroe County, and Chautauqua County, New York. Evans Bancorp, Inc. was founded in 1920 and is headquartered in Williamsville, New York.