Meta Financial Group (CASH) & First Bank (FRBA) Critical Comparison

First Bank (NASDAQ: FRBA) and Meta Financial Group (NASDAQ:CASH) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, profitability, risk, analyst recommendations, dividends, earnings and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for First Bank and Meta Financial Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Bank 0 0 1 0 3.00
Meta Financial Group 0 1 1 0 2.50

First Bank presently has a consensus target price of $14.00, indicating a potential upside of 10.24%. Meta Financial Group has a consensus target price of $108.00, indicating a potential upside of 52.54%. Given Meta Financial Group’s higher possible upside, analysts clearly believe Meta Financial Group is more favorable than First Bank.

Dividends

First Bank pays an annual dividend of $0.08 per share and has a dividend yield of 0.6%. Meta Financial Group pays an annual dividend of $0.52 per share and has a dividend yield of 0.7%. First Bank pays out 12.5% of its earnings in the form of a dividend. Meta Financial Group pays out 9.8% 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. Meta Financial Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

46.0% of First Bank shares are held by institutional investors. Comparatively, 74.1% of Meta Financial Group shares are held by institutional investors. 6.1% of Meta Financial Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares First Bank and Meta Financial Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Bank 17.19% N/A N/A
Meta Financial Group 18.74% 16.60% 1.58%

Volatility and Risk

First Bank has a beta of 0.56, meaning that its stock price is 44% less volatile than the S&P 500. Comparatively, Meta Financial Group has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500.

Valuation and Earnings

This table compares First Bank and Meta Financial Group’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
First Bank $31.35 million 6.08 $9.61 million $0.64 19.84
Meta Financial Group $238.92 million 2.77 $49.55 million $5.30 13.36

Meta Financial Group has higher revenue and earnings than First Bank. Meta Financial Group is trading at a lower price-to-earnings ratio than First Bank, indicating that it is currently the more affordable of the two stocks.

Summary

Meta Financial Group beats First Bank on 12 of the 15 factors compared between the two stocks.

First Bank Company Profile

First Bank is a commercial bank. The Company provides a range of lending, deposit and other financial products and services. It operates through Community Banking segment, which is engaged in providing a range of commercial and retail and related banking services. It offers a range of lending products to meet the needs of its customers located within its market areas, including commercial and industrial loans, commercial real estate loans (including owner-occupied, investor, construction and development and multi-family loans), residential real estate loans, and consumer and other loans. It offers a range of deposit instruments, including non-interest bearing demand deposits (such as checking accounts), interest bearing demand accounts, money market accounts, savings accounts and certificates of deposit. It operates over 10 branches located in Cranbury, Denville, Ewing, Flemington, Hamilton, Lawrence, Somerset, Randolph and Williamstown, New Jersey, and Trevose, Pennsylvania.

Meta Financial Group Company Profile

Meta Financial Group, Inc. is a unitary savings and loan holding company. The Company operates through its banking subsidiary, MetaBank (the Bank). Its segments include Payments, Banking, and Corporate Services/Other. MetaBank is both a community-oriented financial institution offering a range of financial services to meet the needs of the communities it serves and a payments company providing services on a nationwide basis. It operates in both the banking and payments industries through MetaBank, its retail banking operation; Meta Payment Systems (MPS), its electronic payments division; AFS/IBEX Financial Services Inc. (AFS/IBEX), its insurance premium financing division, and Refund Advantage, EPS Financial, LLC (EPS) Financial and Specialty Consumer Services, its tax-related financial solutions divisions.

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