Reviewing Rhinebeck Bancorp (NASDAQ:RBKB) & First Business Financial Services (NASDAQ:FBIZ)

First Business Financial Services (NASDAQ:FBIZ) and Rhinebeck Bancorp (NASDAQ:RBKB) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, earnings, risk, dividends, valuation, analyst recommendations and profitability.

Earnings & Valuation

This table compares First Business Financial Services and Rhinebeck Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Business Financial Services	$279.25 million	2.14	$50.32 million	$6.56	10.90
Rhinebeck Bancorp	$75.84 million	2.66	$10.05 million	$0.71	18.17

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

Analyst Ratings

This is a breakdown of recent recommendations for First Business Financial Services and Rhinebeck Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Business Financial Services	0	0	3	1	3.25
Rhinebeck Bancorp	1	0	0	0	1.00

First Business Financial Services currently has a consensus price target of $75.50, suggesting a potential upside of 5.61%. Given First Business Financial Services’ stronger consensus rating and higher possible upside, equities analysts clearly believe First Business Financial Services is more favorable than Rhinebeck Bancorp.

Volatility & Risk

First Business Financial Services has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500. Comparatively, Rhinebeck Bancorp has a beta of 0.16, indicating that its stock price is 84% less volatile than the S&P 500.

Profitability

This table compares First Business Financial Services and Rhinebeck Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Business Financial Services	19.28%	14.92%	1.29%
Rhinebeck Bancorp	12.99%	7.20%	0.73%

Institutional & Insider Ownership

60.1% of First Business Financial Services shares are owned by institutional investors. Comparatively, 23.9% of Rhinebeck Bancorp shares are owned by institutional investors. 5.0% of First Business Financial Services shares are owned by insiders. Comparatively, 3.0% of Rhinebeck Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

First Business Financial Services beats Rhinebeck Bancorp on 13 of the 15 factors compared between the two stocks.

About First Business Financial Services

First Business Financial Services, Inc. operates as the bank holding company for First Business Bank that provides commercial banking products and services for small and medium-sized businesses, business owners, executives, professionals, and high net worth individuals in Wisconsin, Kansas, and Missouri. The company offers real estate lending, commercial and industrial lending, asset-based lending, accounts receivable financing, equipment financing loans and leases, floorplan financing, vendor financing, small business administration lending and servicing, treasury management solutions, and company retirement services. It also provides private wealth management for individuals, including creating and executing asset allocation strategies, trust and estate administration, financial planning, investment management, and access to brokerage and custody-only services. In addition, the company offers bank consulting consisting of investment portfolio administrative and asset liability management services, and commercial deposit accounts. The company was founded in 1909 and is headquartered in Madison, Wisconsin.

About Rhinebeck Bancorp

Rhinebeck Bancorp, Inc. operates as the bank holding company for Rhinebeck Bank that provides banking and financial products and services to consumer and commercial customers in the Hudson Valley region of New York. The company offers deposits, including non-interest-bearing demand, interest bearing demand, money market, commercial and personal checking, individual retirement, and saving accounts, as well as certificates of deposit. It also provides direct and indirect automobile loans; non-residential commercial real estate loans; commercial business loans, such as term loans, revolving lines of credit, and lines of credit; residential mortgage and construction, one- to four-family residential real estate, multi-family real estate, commercial construction, and land development loans; and other consumer loans consist of home equity loans and lines of credit. In addition, the company offers retail brokerage and advisory services; life insurance services; and invests in mutual funds, annuities, and other assets. Rhinebeck Bancorp, Inc. was founded in 1860 and is headquartered in Poughkeepsie, New York. Rhinebeck Bancorp, Inc. is a subsidiary of Rhinebeck Bancorp, MHC.