Contrasting Northeast Indiana Bancorp (OTCMKTS:NIDB) and Southern Missouri Bancorp (NASDAQ:SMBC)

Northeast Indiana Bancorp (OTCMKTS:NIDB) and Southern Missouri Bancorp (NASDAQ:SMBC) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, risk, dividends and analyst recommendations.

Institutional and Insider Ownership

49.5% of Southern Missouri Bancorp shares are held by institutional investors. 19.8% of Northeast Indiana Bancorp shares are held by company insiders. Comparatively, 15.8% of Southern Missouri Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current recommendations for Northeast Indiana Bancorp and Southern Missouri Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northeast Indiana Bancorp	0	0	0	0	0.00
Southern Missouri Bancorp	0	3	1	0	2.25

Southern Missouri Bancorp has a consensus price target of $68.33, indicating a potential upside of 5.84%. Given Southern Missouri Bancorp’s stronger consensus rating and higher probable upside, analysts clearly believe Southern Missouri Bancorp is more favorable than Northeast Indiana Bancorp.

Profitability

This table compares Northeast Indiana Bancorp and Southern Missouri Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northeast Indiana Bancorp	18.63%	N/A	N/A
Southern Missouri Bancorp	20.80%	11.92%	1.30%

Earnings & Valuation

This table compares Northeast Indiana Bancorp and Southern Missouri Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northeast Indiana Bancorp	$33.64 million	1.55	$6.27 million	$2.64	8.33
Southern Missouri Bancorp	$192.39 million	3.73	$58.58 million	$5.78	11.17

Southern Missouri Bancorp has higher revenue and earnings than Northeast Indiana Bancorp. Northeast Indiana Bancorp is trading at a lower price-to-earnings ratio than Southern Missouri Bancorp, indicating that it is currently the more affordable of the two stocks.

Dividends

Northeast Indiana Bancorp pays an annual dividend of $0.76 per share and has a dividend yield of 3.5%. Southern Missouri Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 1.5%. Northeast Indiana Bancorp pays out 28.8% of its earnings in the form of a dividend. Southern Missouri Bancorp pays out 17.3% 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. Southern Missouri Bancorp has raised its dividend for 13 consecutive years.

Volatility and Risk

Northeast Indiana Bancorp has a beta of 0.17, suggesting that its share price is 83% less volatile than the S&P 500. Comparatively, Southern Missouri Bancorp has a beta of 0.99, suggesting that its share price is 1% less volatile than the S&P 500.

Summary

Southern Missouri Bancorp beats Northeast Indiana Bancorp on 15 of the 17 factors compared between the two stocks.

About Northeast Indiana Bancorp

Northeast Indiana Bancorp, Inc. operates as the bank holding company for First Federal Savings Bank that provides various banking and financial advisory services. The company offers checking accounts, savings accounts, retirement accounts, health savings accounts, and direct deposits, as well as certificates of deposit. It also provides mortgage, refinance, new construction, and home equity loans; auto, recreational vehicle, and unsecured loans; and revolving lines of credit, term loans, real estate loans, letter of credit, and small business administration loans, as well as debit and credit cards. In addition, the company offers merchant, online banking, and cash management services. It operates through full-service locations in Huntington, Warsaw, and Fort Wayne, Indiana. The company was founded in 1912 and is headquartered in Huntington, Indiana.

About Southern Missouri Bancorp

Southern Missouri Bancorp, Inc. operates as the bank holding company for Southern Bank that provides banking and financial services to individuals and corporate customers in the United States. The company offers deposits products, including interest-bearing and noninterest-bearing transaction accounts, saving accounts, certificates of deposit, retirement savings plans, and money market deposit accounts. It also provides loans, such as residential mortgage, commercial real estate, construction, and commercial business loans; and consumer loans comprising home equity, direct and indirect automobile loans, second mortgages, mobile home loans, and loans secured by deposits. In addition, the company offers fiduciary and investment management services; commercial and consumer insurance; online and mobile banking services; and debit or credit cards. The company was founded in 1887 and is headquartered in Poplar Bluff, Missouri.