Burke & Herbert Financial Services (NASDAQ:BHRB) and Old National Bancorp (NASDAQ:ONB) Critical Analysis

Old National Bancorp (NASDAQ:ONB) and Burke & Herbert Financial Services (NASDAQ:BHRB) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, earnings and institutional ownership.

Earnings and Valuation

This table compares Old National Bancorp and Burke & Herbert Financial Services”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Old National Bancorp	$1.89 billion	3.31	$539.19 million	$1.68	11.66
Burke & Herbert Financial Services	$256.55 million	2.92	$35.71 million	$2.40	20.84

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

Dividends

Old National Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 2.9%. Burke & Herbert Financial Services pays an annual dividend of $2.20 per share and has a dividend yield of 4.4%. Old National Bancorp pays out 33.3% of its earnings in the form of a dividend. Burke & Herbert Financial Services pays out 91.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider & Institutional Ownership

83.7% of Old National Bancorp shares are held by institutional investors. 0.9% of Old National Bancorp shares are held by insiders. Comparatively, 10.9% of Burke & Herbert Financial Services shares are held 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.

Profitability

This table compares Old National Bancorp and Burke & Herbert Financial Services’ 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%
Burke & Herbert Financial Services	8.88%	15.15%	1.35%

Analyst Ratings

This is a summary of recent recommendations and price targets for Old National Bancorp and Burke & Herbert Financial Services, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Old National Bancorp	0	1	5	1	3.00
Burke & Herbert Financial Services	0	0	2	0	3.00

Old National Bancorp currently has a consensus target price of $25.71, suggesting a potential upside of 31.26%. Burke & Herbert Financial Services has a consensus target price of $76.00, suggesting a potential upside of 51.97%. Given Burke & Herbert Financial Services’ higher probable upside, analysts plainly believe Burke & Herbert Financial Services is more favorable than Old National Bancorp.

Summary

Old National Bancorp beats Burke & Herbert Financial Services on 8 of the 15 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 Burke & Herbert Financial Services

Burke Herbert Financial Services Corp. is a bank holding company, which engages in the provision of banking products and financial services to small to medium-sized businesses, their owners and employees, professional corporations, non-profits, and individuals. It operates through the following loan portfolio segments: Commercial Real Estate, Owner-Occupied Commercial Real Estate, Acquisition, Construction, and Development, Commercial and Industrial, Single Family Residential (1-4 Units), and Consumer Non-Real Estate and Other. The Commercial Real Estate segment includes leasing of the real estate collateral or income generated from the sale of the collateral. The Owner-Occupied Commercial Real Estate segment focuses on the operations of the business that occupies the property and the value of the collateral. The Acquisition, Construction, and Development segment offers creditworthiness of the borrower, project completion within budget, sale after completion, and the value of the collateral. The Commercial and Industrial segment is involved in the operations of the business and the value of the collateral. The Single Family Residential (1-4 Units) segment provides loans for investment purpose carry risk associated with the continued creditworthiness of the borrower, the value of the collateral, and either the net operating income generated from the lease of the real estate collateral or income generated from the sale of the collateral. The Consumer Non-Real Estate and Other segment covers loans carry risk associated with the creditworthiness of the borrower and the value of the collateral. The company was founded on September 14, 2022 and is headquartered in Alexandria, VA.