Analyzing ECB Bancorp (NASDAQ:ECBK) & First Internet Bancorp (NASDAQ:INBK)

First Internet Bancorp (NASDAQ:INBK) and ECB Bancorp (NASDAQ:ECBK) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, dividends, earnings, profitability, valuation and institutional ownership.

Institutional and Insider Ownership

65.5% of First Internet Bancorp shares are owned by institutional investors. Comparatively, 30.3% of ECB Bancorp shares are owned by institutional investors. 8.0% of First Internet Bancorp shares are owned by insiders. Comparatively, 9.0% of ECB Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for First Internet Bancorp and ECB Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Internet Bancorp	1	3	1	0	2.00
ECB Bancorp	0	0	1	0	3.00

First Internet Bancorp currently has a consensus price target of $25.17, suggesting a potential upside of 22.35%. Given First Internet Bancorp’s higher possible upside, research analysts clearly believe First Internet Bancorp is more favorable than ECB Bancorp.

Profitability

This table compares First Internet Bancorp and ECB Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Internet Bancorp	-10.05%	-1.54%	-0.10%
ECB Bancorp	9.78%	4.59%	0.51%

Valuation and Earnings

This table compares First Internet Bancorp and ECB Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Internet Bancorp	$109.81 million	1.63	-$35.17 million	($4.03)	-5.10
ECB Bancorp	$79.51 million	1.87	$7.77 million	$0.93	18.20

ECB Bancorp has lower revenue, but higher earnings than First Internet Bancorp. First Internet Bancorp is trading at a lower price-to-earnings ratio than ECB Bancorp, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

First Internet Bancorp has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500. Comparatively, ECB Bancorp has a beta of 0.46, suggesting that its share price is 54% less volatile than the S&P 500.

Summary

ECB Bancorp beats First Internet Bancorp on 9 of the 13 factors compared between the two stocks.

About First Internet Bancorp

First Internet Bancorp operates as the bank holding company for First Internet Bank of Indiana that provides commercial, small business, consumer, and municipal banking products and services to individuals and commercial customers in the United States. The company accepts non-interest bearing and interest-bearing demand deposit, commercial deposit, savings, money market, and Banking-as-a-Service brokered deposit accounts, as well as certificates of deposit. It also offers commercial and industrial, owner-occupied and investor commercial real estate, construction, residential mortgage, home equity, line of credit and home improvement, small installment, term, and other consumer loans, as well as single tenant lease financing, and public and healthcare finance; franchise finance; and small business lending. In addition, the company is involved in the purchase, manage, service, and safekeeping of municipal securities; and provision of public and municipal lending and leasing products to government entities. Further, the company offers corporate credit card and treasury management services. First Internet Bancorp was founded in 1998 and is headquartered in Fishers, Indiana.

About ECB Bancorp

ECB Bancorp, Inc. operating as a holding company for Everett Co-operative Bank that provides various banking products and services. The company accepts various deposit products, including certificate of deposit accounts, IRAs, money market accounts, savings accounts, demand deposit accounts, and interest-bearing and noninterest-bearing checking accounts. It also offers one- to four-family residential real estate, commercial real estate and multifamily real estate, construction and land, commercial, and consumer loans, as well as home equity loans and lines of credit. In addition, the company invests in securities, consisting primarily of U.S. government and federal agency obligations, mortgage-backed securities, and corporate bonds. ECB Bancorp, Inc. was founded in 1890 and is based in Everett, Massachusetts.