Western New England Bancorp (NASDAQ:WNEB – Get Free Report) and Business First Bancshares (NASDAQ:BFST – Get Free Report) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.
Dividends
Western New England Bancorp pays an annual dividend of $0.28 per share and has a dividend yield of 2.0%. Business First Bancshares pays an annual dividend of $0.60 per share and has a dividend yield of 1.9%. Western New England Bancorp pays out 28.0% of its earnings in the form of a dividend. Business First Bancshares pays out 21.4% 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. Business First Bancshares has raised its dividend for 2 consecutive years.
Profitability
This table compares Western New England Bancorp and Business First Bancshares’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Western New England Bancorp | 14.53% | 8.02% | 0.72% |
| Business First Bancshares | 17.08% | 11.18% | 1.15% |
Earnings & Valuation
This table compares Western New England Bancorp and Business First Bancshares”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Western New England Bancorp | $131.13 million | 2.11 | $15.27 million | $1.00 | 13.79 |
| Business First Bancshares | $356.50 million | 2.94 | $87.86 million | $2.80 | 11.51 |
Business First Bancshares has higher revenue and earnings than Western New England Bancorp. Business First Bancshares is trading at a lower price-to-earnings ratio than Western New England Bancorp, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Western New England Bancorp has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500. Comparatively, Business First Bancshares has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500.
Analyst Ratings
This is a summary of current ratings and target prices for Western New England Bancorp and Business First Bancshares, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Western New England Bancorp | 0 | 3 | 1 | 0 | 2.25 |
| Business First Bancshares | 0 | 0 | 5 | 0 | 3.00 |
Western New England Bancorp presently has a consensus price target of $15.50, indicating a potential upside of 12.42%. Business First Bancshares has a consensus price target of $35.75, indicating a potential upside of 10.98%. Given Western New England Bancorp’s higher probable upside, research analysts clearly believe Western New England Bancorp is more favorable than Business First Bancshares.
Institutional and Insider Ownership
67.9% of Western New England Bancorp shares are owned by institutional investors. Comparatively, 47.3% of Business First Bancshares shares are owned by institutional investors. 6.6% of Western New England Bancorp shares are owned by company insiders. Comparatively, 5.7% of Business First Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Summary
Business First Bancshares beats Western New England Bancorp on 11 of the 16 factors compared between the two stocks.
About Western New England Bancorp
Western New England Bancorp, Inc. operates as the holding company for Westfield Bank that provides a range of commercial and retail banking products and services to individuals and businesses. The company accepts various deposit accounts, including interest-bearing and noninterest-bearing checking, commercial checking, business, nonprofit and municipal checking, savings, money market and sweep, individual retirement, and other savings accounts; time deposits; certificates of deposit; and interest on lawyer's trust accounts. It also offers residential real estate loans, including first mortgages, home equity loans, and home equity lines, and secured by one-to-four family residential properties; commercial and industrial loans, such as letters of credit, revolving lines of credit, working capital, equipment financing, and term loans; commercial mortgage loans; construction and land development loans; home equity loans comprising home equity revolving loans and lines of credit; and consumer loans, including automobile, spa and pool, collateral, and personal lines of credit. In addition, the company provides automated teller machine (ATM), telephone and online banking, remote deposit capture, cash management, overdraft and safe deposit facility, and night deposit services. The company was formerly known as Westfield Financial, Inc. and changed its name to Western New England Bancorp, Inc. in October 2016. The company was founded in 1853 and is headquartered in Westfield, Massachusetts.
About Business First Bancshares
Business First Bancshares, Inc. operates as the bank holding company for b1BANK that provides various banking products and services in Louisiana and Texas. It offers various deposit products and services, including checking, demand, money market, time, and savings accounts; and certificates of deposits, remote deposit capture, and direct deposit services. The company also provides commercial and industrial loans, such as working capital, term, equipment financing, asset acquisition, expansion and development, borrowing base, and other loan products, as well as commercial lines of credit, accounts receivable factoring, agricultural financing, and letters of credit; construction and development loans; commercial real estate loans; residential real estate loans comprising first and second lien 1-4 family mortgage loans, and home equity lines of credit; and consumer loans, including secured and unsecured installment, and term loans. In addition, it offers wealth management products, including mutual funds, annuities, individual retirement accounts, and other financial products, as well as other fiduciary and private banking products and services. Further, the company provides a range of other financial services comprising debit and credit cards, treasury and cash management, merchant, automated clearing house, lock-box, receivables factoring, correspondent banking, and other treasury services, as well as employee and payroll benefits solutions; and drive-through banking facilities, automated teller machines, night depository, personalized checks, electronic funds transfer, domestic and foreign wire transfer, traveler's checks, vault, loan and deposit sweep accounts, online and mobile banking, e-statements, and bank-by-mail services. Business First Bancshares, Inc. was founded in 2006 and is headquartered in Baton Rouge, Louisiana.
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