Critical Comparison: First Internet Bancorp (NASDAQ:INBK) & Primis Financial (NASDAQ:FRST)

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

Insider & Institutional Ownership

75.0% of Primis Financial shares are held by institutional investors. Comparatively, 65.5% of First Internet Bancorp shares are held by institutional investors. 10.9% of Primis Financial shares are held by company insiders. Comparatively, 8.0% of First Internet Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk and Volatility

Primis Financial has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500. Comparatively, First Internet Bancorp has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Primis Financial	$170.49 million	1.38	-$7.54 million	($0.29)	-32.93
First Internet Bancorp	$135.23 million	1.58	$25.28 million	$2.41	10.20

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

Dividends

Primis Financial pays an annual dividend of $0.40 per share and has a dividend yield of 4.2%. First Internet Bancorp pays an annual dividend of $0.24 per share and has a dividend yield of 1.0%. Primis Financial pays out -137.9% of its earnings in the form of a dividend. First Internet Bancorp pays out 10.0% 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. Primis Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent ratings and target prices for Primis Financial and First Internet Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Primis Financial	0	0	2	0	3.00
First Internet Bancorp	0	2	2	0	2.50

Primis Financial presently has a consensus price target of $7.50, indicating a potential downside of 21.47%. First Internet Bancorp has a consensus price target of $31.75, indicating a potential upside of 29.12%. Given First Internet Bancorp’s higher possible upside, analysts plainly believe First Internet Bancorp is more favorable than Primis Financial.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Primis Financial	-2.97%	-2.05%	-0.20%
First Internet Bancorp	7.45%	5.86%	0.40%

Summary

First Internet Bancorp beats Primis Financial on 9 of the 15 factors compared between the two stocks.

About Primis Financial

Primis Financial Corp. operates as the bank holding company for Primis Bank that provides a range of financial services to individuals and small and medium sized businesses in the United States. Its deposit products include checking, NOW, savings, and money market accounts, as well as certificates of deposits. The company also provides commercial business and real estate, construction, secured asset based, small business administration, mortgage warehouse lending products, as well as financing for medical, dental, and veterinary businesses; residential mortgage, trust mortgage, home equity lines of credit, secured and unsecured personal, and consumer loans, as well as life insurance premium financing and demand loans. It also offers cash management services comprising investment/sweep, zero balance, and controlled disbursement accounts; and wire transfer, employer/payroll processing, night depository, depository transfer, merchant, ACH origination, and remote deposit capture services. In addition, the company provides debit cards, ATM services, notary services, and mobile and online banking. It operates full-service branches in Virginia and Maryland. The company was formerly known as Southern National Bancorp of Virginia, Inc. and changed its name to Primis Financial Corp. Primis Financial Corp. was founded in 2004 and is based in McLean, Virginia.

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.