Analyzing Old National Bancorp (NASDAQ:ONB) and Ohio Valley Banc (NASDAQ:OVBC)

Ohio Valley Banc (NASDAQ:OVBC) and Old National Bancorp (NASDAQ:ONB) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, valuation, analyst recommendations, institutional ownership, profitability and dividends.

Analyst Ratings

This is a summary of current recommendations and price targets for Ohio Valley Banc and Old National Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ohio Valley Banc	0	0	1	0	3.00
Old National Bancorp	0	3	7	1	2.82

Old National Bancorp has a consensus target price of $27.27, indicating a potential upside of 14.21%. Given Old National Bancorp’s higher probable upside, analysts clearly believe Old National Bancorp is more favorable than Ohio Valley Banc.

Institutional & Insider Ownership

22.1% of Ohio Valley Banc shares are held by institutional investors. Comparatively, 83.7% of Old National Bancorp shares are held by institutional investors. 7.1% of Ohio Valley Banc shares are held by company insiders. Comparatively, 0.9% of Old National Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Ohio Valley Banc and Old National Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ohio Valley Banc	$88.93 million	2.17	$11.00 million	$3.00	13.69
Old National Bancorp	$3.74 billion	2.50	$669.26 million	$1.79	13.34

Old National Bancorp has higher revenue and earnings than Ohio Valley Banc. Old National Bancorp is trading at a lower price-to-earnings ratio than Ohio Valley Banc, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ohio Valley Banc and Old National Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ohio Valley Banc	14.97%	8.97%	0.93%
Old National Bancorp	17.91%	15.06%	1.22%

Dividends

Ohio Valley Banc pays an annual dividend of $0.92 per share and has a dividend yield of 2.2%. Old National Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 2.3%. Ohio Valley Banc pays out 30.7% of its earnings in the form of a dividend. Old National Bancorp pays out 31.3% 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. Ohio Valley Banc has increased its dividend for 3 consecutive years.

Summary

Old National Bancorp beats Ohio Valley Banc on 11 of the 17 factors compared between the two stocks.

About Ohio Valley Banc

Ohio Valley Banc Corp. operates as the bank holding company for The Ohio Valley Bank Company that provides commercial and consumer banking products and services. The company operates in two segments, Banking and Consumer Finance. It accepts various deposit products, including checking, savings, time, and money market accounts, as well as individual retirement accounts, demand deposits, NOW accounts, and certificates of deposit. The company also provides various residential real estate loans, including one-to four-family residential mortgages; commercial loans for securing equipment, inventory, stock, commercial real estate, and rental property; and consumer loans secured by automobiles, mobile homes, recreational vehicles, and other personal property, as well as personal loans, unsecured credit card receivables, floor plan and student loans, and construction loans. In addition, it offers safe deposit box, wire transfer, credit card, home equity loans, and Internet banking services; and financial management online services, such as cash management and news updates related to repossession auctions, current rates, and general bank news. Further, the company provides automatic teller machines (ATMs), consumer finance, seasonal tax preparation, commercial property, and various liability insurance services, as well as trust and online-only consumer direct mortgage services. The company owns and operates ATMs, including off-site ATMs. It operates offices in Ohio and West Virginia. The company was founded in 1872 and is based in Gallipolis, Ohio.

About Old National Bancorp

Old National Bancorp operates as the bank holding company for Old National Bank that provides various financial services to individual and commercial customers in the United States. It accepts deposit accounts, including noninterest-bearing demand, interest-bearing checking, negotiable order of withdrawal, savings and money market, and time deposits; and offers loans, such as home equity lines of credit, residential real estate loans, consumer loans, commercial loans, commercial real estate loans, agricultural loans, letters of credit, and lease financing. The company also provides debit and automated teller machine cards, telephone access, online banking, and other electronic and mobile banking services; cash management, private banking, brokerage, trust, investment advisory, and other traditional banking services; wealth management, investment, and foreign currency services; and treasury management, merchant, and capital markets services, as well as community development lending and equity investment solutions. The company was founded in 1834 and is headquartered in Evansville, Indiana.