Emclaire Financial (NASDAQ:EMCF) and Bank of America (NYSE:BAC) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.

Insider & Institutional Ownership

6.4% of Emclaire Financial shares are held by institutional investors. Comparatively, 68.2% of Bank of America shares are held by institutional investors. 16.6% of Emclaire Financial shares are held by insiders. Comparatively, 0.2% of Bank of America 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

Emclaire Financial has a beta of 0.44, suggesting that its share price is 56% less volatile than the S&P 500. Comparatively, Bank of America has a beta of 1.53, suggesting that its share price is 53% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Emclaire Financial and Bank of America, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Emclaire Financial 0 0 0 0 N/A
Bank of America 0 9 8 0 2.47

Bank of America has a consensus target price of $32.56, suggesting a potential upside of 10.57%. Given Bank of America’s higher probable upside, analysts clearly believe Bank of America is more favorable than Emclaire Financial.

Earnings & Valuation

This table compares Emclaire Financial and Bank of America’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Emclaire Financial $35.17 million 2.68 $4.21 million N/A N/A
Bank of America $110.58 billion 2.53 $28.15 billion $2.61 11.28

Bank of America has higher revenue and earnings than Emclaire Financial.

Profitability

This table compares Emclaire Financial and Bank of America’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Emclaire Financial 13.21% 7.59% 0.60%
Bank of America 25.42% 11.79% 1.22%

Dividends

Emclaire Financial pays an annual dividend of $1.16 per share and has a dividend yield of 3.3%. Bank of America pays an annual dividend of $0.60 per share and has a dividend yield of 2.0%. Bank of America pays out 23.0% of its earnings in the form of a dividend. Emclaire Financial has increased its dividend for 3 consecutive years and Bank of America has increased its dividend for 5 consecutive years.

Summary

Bank of America beats Emclaire Financial on 10 of the 15 factors compared between the two stocks.

About Emclaire Financial

Emclaire Financial Corp operates as the bank holding company for The Farmers National Bank of Emlenton that provides retail and commercial financial products and services to individuals and businesses in western Pennsylvania. The company's deposit products include checking, savings, and term certificate accounts; time deposits; noninterest bearing and interest bearing demand deposit accounts; and money market accounts. Its loan portfolio comprises one-to-four family mortgage loans, residential and commercial mortgages loans, home equity loans, and commercial business and commercial real estate loans; and consumer loans, such as loans for automobile purchases, home improvements not secured by real estate, capital, and other personal expenditures, as well as unsecured revolving personal lines of credit and overdraft protection. The company, through its subsidiary, Emclaire Settlement Services, LLC, also provides real estate settlement services. As of February 20, 2019, it operated 20 full service offices in Venango, Allegheny, Butler, Clarion, Clearfield, Crawford, Elk, Jefferson, and Mercer counties in Pennsylvania, as well as in Hancock County, West Virginia. The company was founded in 1900 and is headquartered in Emlenton, Pennsylvania.

About Bank of America

Bank of America Corporation, through its subsidiaries, provides banking and financial products and services for individual consumers, small- and middle-market businesses, institutional investors, large corporations, and governments worldwide. It operates through four segments: Consumer Banking, Global Wealth & Investment Management (GWIM), Global Banking, and Global Markets. The Consumer Banking segment offers traditional and money market savings accounts, CDs and IRAs, noninterest- and interest-bearing checking accounts, and investment accounts and products; and credit and debit cards, residential mortgages, and home equity loans, as well as direct and indirect loans, such as automotive, recreational vehicle, and consumer personal loans. This segment provides its products and services through approximately 4,300 financial centers; 16,300 ATMs; call centers; and digital banking platforms. The GWIM segment offers investment management, brokerage, banking, and trust and retirement products; and wealth management solutions targeted to high net worth and ultra high net worth clients, as well as customized solutions to meet clients' wealth structuring, investment management, and trust and banking needs, including specialty asset management services. The Global Banking segment provides lending products and services, including commercial loans, leases, commitment facilities, trade finance, and real estate and asset-based lending; treasury solutions, such as treasury management, foreign exchange, and short-term investing options; working capital management solutions; and debt and equity underwriting and distribution, and merger-related and other advisory services. The Global Markets segment offers market-making, financing, securities clearing, settlement, and custody services, as well as risk management, foreign exchange, fixed-income, and mortgage-related products. Bank of America Corporation was founded in 1874 and is headquartered in Charlotte, North Carolina.

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