Head to Head Contrast: Hingham Institution for Savings (NASDAQ:HIFS) and Bankwell Financial Group (NASDAQ:BWFG)

Bankwell Financial Group (NASDAQ:BWFG) and Hingham Institution for Savings (NASDAQ:HIFS) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, analyst recommendations, dividends, earnings and institutional ownership.

Profitability

This table compares Bankwell Financial Group and Hingham Institution for Savings’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bankwell Financial Group	18.71%	13.31%	1.20%
Hingham Institution for Savings	21.17%	7.89%	0.81%

Valuation & Earnings

This table compares Bankwell Financial Group and Hingham Institution for Savings”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bankwell Financial Group	$207.71 million	2.22	$35.20 million	$4.98	11.64
Hingham Institution for Savings	$236.78 million	2.78	$54.55 million	$22.81	13.22

Hingham Institution for Savings has higher revenue and earnings than Bankwell Financial Group. Bankwell Financial Group is trading at a lower price-to-earnings ratio than Hingham Institution for Savings, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

35.8% of Bankwell Financial Group shares are held by institutional investors. Comparatively, 49.3% of Hingham Institution for Savings shares are held by institutional investors. 21.0% of Bankwell Financial Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk and Volatility

Bankwell Financial Group has a beta of 0.62, indicating that its share price is 38% less volatile than the S&P 500. Comparatively, Hingham Institution for Savings has a beta of 0.84, indicating that its share price is 16% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Bankwell Financial Group and Hingham Institution for Savings, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bankwell Financial Group	0	2	2	0	2.50
Hingham Institution for Savings	0	0	1	0	3.00

Bankwell Financial Group presently has a consensus target price of $52.00, suggesting a potential downside of 10.30%. Given Bankwell Financial Group’s higher possible upside, analysts plainly believe Bankwell Financial Group is more favorable than Hingham Institution for Savings.

Dividends

Bankwell Financial Group pays an annual dividend of $0.80 per share and has a dividend yield of 1.4%. Hingham Institution for Savings pays an annual dividend of $2.52 per share and has a dividend yield of 0.8%. Bankwell Financial Group pays out 16.1% of its earnings in the form of a dividend. Hingham Institution for Savings pays out 11.0% 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.

Summary

Hingham Institution for Savings beats Bankwell Financial Group on 10 of the 16 factors compared between the two stocks.

About Bankwell Financial Group

Bankwell Financial Group, Inc. operates as the bank holding company for Bankwell Bank that provides various banking services for individual and commercial customers. It offers various traditional depository products, including checking, savings, money market, and certificates of deposit. The company also provides first mortgage loans secured by one-to-four family owner occupied residential properties for personal use; home equity loans and home equity lines of credit secured by owner occupied one-to-four family residential properties; loans secured by commercial real estate, multi-family dwellings, owner-occupied commercial real estate, and investor-owned one-to-four family dwellings; commercial construction loans for commercial development projects, including apartment buildings and condominiums, as well as office buildings, retail, and other income producing properties; land loans; commercial business loans secured by assignments of corporate assets and personal guarantees of the business owners; loans to finance insurance premiums; overdraft lines of credit; and unsecured personal loans. It operates branches in New Canaan, Stamford, Fairfield, Westport, Darien, Norwalk, and Hamden, Connecticut. The company was formerly known as BNC Financial Group, Inc. and changed its name to Bankwell Financial Group, Inc. in September 2013. Bankwell Financial Group, Inc. was founded in 2002 and is headquartered in New Canaan, Connecticut.

About Hingham Institution for Savings

Hingham Institution for Savings provides various financial products and services to individuals and small businesses in the United States. It offers savings, checking, money market, demand, and negotiable order of withdrawal accounts, as well as certificates of deposit. The company provides commercial and residential real estate, construction, home equity, commercial, consumer, and mortgage loans. In addition, it offers ATMs, debit cards, and Internet-based banking services. The company offers its services through a network of offices in Boston; Washington, D.C.; and San Francisco Bay Area. Hingham Institution for Savings was incorporated in 1834 and is headquartered in Hingham, Massachusetts.