MutualFirst Financial (NASDAQ: MFSF) and Heartland Financial USA (NASDAQ:HTLF) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, earnings, valuation, profitability and dividends.
This table compares MutualFirst Financial and Heartland Financial USA’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Heartland Financial USA||18.14%||9.77%||0.93%|
47.5% of MutualFirst Financial shares are held by institutional investors. Comparatively, 47.9% of Heartland Financial USA shares are held by institutional investors. 11.3% of MutualFirst Financial shares are held by company insiders. Comparatively, 9.0% of Heartland Financial USA shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Volatility and Risk
MutualFirst Financial has a beta of 0.33, indicating that its stock price is 67% less volatile than the S&P 500. Comparatively, Heartland Financial USA has a beta of 0.69, indicating that its stock price is 31% less volatile than the S&P 500.
This is a breakdown of recent recommendations and price targets for MutualFirst Financial and Heartland Financial USA, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Heartland Financial USA||0||4||1||0||2.20|
MutualFirst Financial currently has a consensus target price of $36.50, indicating a potential downside of 5.19%. Heartland Financial USA has a consensus target price of $52.00, indicating a potential downside of 4.15%. Given Heartland Financial USA’s stronger consensus rating and higher possible upside, analysts clearly believe Heartland Financial USA is more favorable than MutualFirst Financial.
MutualFirst Financial pays an annual dividend of $0.72 per share and has a dividend yield of 1.9%. Heartland Financial USA pays an annual dividend of $0.44 per share and has a dividend yield of 0.8%. MutualFirst Financial pays out 38.3% of its earnings in the form of a dividend. Heartland Financial USA pays out 14.9% 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.
Valuation & Earnings
This table compares MutualFirst Financial and Heartland Financial USA’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|MutualFirst Financial||$73.22 million||3.89||$13.24 million||$1.88||20.48|
|Heartland Financial USA||$440.08 million||3.69||$80.34 million||$2.95||18.39|
Heartland Financial USA has higher revenue and earnings than MutualFirst Financial. Heartland Financial USA is trading at a lower price-to-earnings ratio than MutualFirst Financial, indicating that it is currently the more affordable of the two stocks.
Heartland Financial USA beats MutualFirst Financial on 11 of the 16 factors compared between the two stocks.
MutualFirst Financial Company Profile
MutualFirst Financial, Inc. (MutualFirst) is the bank holding company of MutualBank (MutualBank or the Bank). The Bank offers financial services through approximately 30 full service retail financial center offices in Allen, Delaware, Elkhart, Grant, Kosciusko, Randolph, Saint Joseph and Wabash counties in Indiana. MutualBank also has trust offices in Carmel and Crawfordsville, Indiana and a loan origination office in New Buffalo, Michigan. The Bank has a subsidiary, Summit Mortgage, Inc., that operates a mortgage banking firm in Fort Wayne, Indiana. In addition, it originates residential mortgage and commercial loans. MutualWealth and MutualFinancial Advisors are the wealth management and brokerage divisions of the Bank that provide a range of fee-based financial services, including trust, investment, insurance, broker advisory, retirement plan and private banking services, in its market areas.
Heartland Financial USA Company Profile
Heartland Financial USA, Inc. (Heartland) is a diversified financial services company engaged in providing banking, mortgage, private client, investment, treasury management, card services, insurance, and consumer finance services to individuals and businesses. Its segments include community and other banking, and retail mortgage banking. Its community and other banking segment is engaged in making loans to, and generating deposits from, individuals and businesses in the markets where Heartland has banks. Its retail mortgage banking segment is engaged in the origination of residential loans and subsequent sale of those loans to investors. The Company conducts its community banking business through independently chartered community banks (collectively, the Bank Subsidiaries). Its securities portfolio consists of United States Government corporations and agencies, mortgage-backed securities and other securities. Its loans include commercial, commercial real estate and consumer loans.
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