Reviewing West Shore Bank (OTCMKTS:WSSH) and Midland States Bancorp (NASDAQ:MSBI)

Midland States Bancorp (NASDAQ:MSBI) and West Shore Bank (OTCMKTS:WSSH) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, risk, institutional ownership, profitability, analyst recommendations and valuation.

Profitability

This table compares Midland States Bancorp and West Shore Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Midland States Bancorp	6.62%	10.41%	0.68%
West Shore Bank	N/A	N/A	N/A

Insider and Institutional Ownership

60.9% of Midland States Bancorp shares are owned by institutional investors. 5.3% of Midland States Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

Midland States Bancorp pays an annual dividend of $1.28 per share and has a dividend yield of 5.8%. West Shore Bank pays an annual dividend of $0.92 per share and has a dividend yield of 2.5%. Midland States Bancorp pays out 126.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Midland States Bancorp has raised its dividend for 1 consecutive years. Midland States Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Midland States Bancorp and West Shore Bank”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Midland States Bancorp	$476.05 million	1.00	-$124.28 million	$1.01	21.91
West Shore Bank	$36.87 million	1.21	$4.41 million	N/A	N/A

West Shore Bank has lower revenue, but higher earnings than Midland States Bancorp.

Analyst Ratings

This is a summary of current ratings and price targets for Midland States Bancorp and West Shore Bank, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Midland States Bancorp	1	5	0	0	1.83
West Shore Bank	0	0	0	0	0.00

Midland States Bancorp presently has a consensus target price of $23.00, suggesting a potential upside of 3.93%. Given Midland States Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe Midland States Bancorp is more favorable than West Shore Bank.

Risk & Volatility

Midland States Bancorp has a beta of 0.66, indicating that its share price is 34% less volatile than the S&P 500. Comparatively, West Shore Bank has a beta of -0.04, indicating that its share price is 104% less volatile than the S&P 500.

Summary

Midland States Bancorp beats West Shore Bank on 11 of the 14 factors compared between the two stocks.

About Midland States Bancorp

Midland States Bancorp, Inc. operates as a financial holding company for Midland States Bank that provides various banking products and services to individuals, businesses, municipalities, and other entities. It operates through Banking, Wealth Management, and Other segments. The company provides a range of financial products and services to consumers and businesses, including commercial loans to finance agricultural equipment and production; and commercial real estate loans for owner occupied offices, warehouses and production facilities, office buildings, hotels, mixed-use residential and commercial facilities, retail centers, multifamily properties, and assisted living facilities. In addition, it offers construction and land development loans, such as real estate investment properties and residential developments, and lesser extent loans; and residential real estate loans, which includes first and second mortgage loans, and home equity lines of credit consisting of loans secured by first or second mortgages on primarily owner occupied primary residences. The company also provides consumer installment loans for the purchase of cars, boats and other recreational vehicles, as well as for the purchase of major appliances and other home improvement projects; and commercial equipment leasing programs for manufacturing, construction, transportation, and healthcare industries. Further, it offers merchant services; deposit products, including checking, time, savings, money market, and certificates of deposit, as well as sweep accounts; letters of credit; and trust and wealth management services, such as financial and estate planning, trustee and custodial, investment management, tax, insurance, and business planning, corporate retirement plan consulting and administration, and retail brokerage services. The company was founded in 1881 and is headquartered in Effingham, Illinois.

About West Shore Bank

West Shore Bank Corp. operates as the bank holding company for West Shore Bank that provides various banking products and services for individuals and businesses. The company accepts checking, saving, money market, certificates of deposit, and individual retirement accounts. Its loan products include auto, recreational, personal term, commercial real estate, small business administration, municipal, business term, and home mortgage and equity loans; business lines of credit; and letters of credit. The company also offers ATM/debit, credit, and gift and travel cards; wealth planning process, investment management, trusts and estates, retirement planning, west shore investment services; savings bonds; and direct deposit, overdraft, safe deposit boxes, wire transfer, remote deposit capture, merchant card, ACH and wire, sweep accounts, positive pay, bill pay, and online and mobile banking services. The company was founded in 1898 and is based in Ludington, Michigan.