Comparing First Bank (NASDAQ:FRBA) & Dacotah Banks (OTCMKTS:DBIN)

First Bank (NASDAQ:FRBA) and Dacotah Banks (OTCMKTS:DBIN) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, risk, dividends, earnings and analyst recommendations.

Dividends

First Bank pays an annual dividend of $0.36 per share and has a dividend yield of 2.1%. Dacotah Banks pays an annual dividend of $0.72 per share and has a dividend yield of 1.6%. First Bank pays out 21.6% of its earnings in the form of a dividend. Dacotah Banks pays out 16.8% 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.

Valuation and Earnings

This table compares First Bank and Dacotah Banks”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Bank	$245.83 million	1.72	$43.66 million	$1.67	10.07
Dacotah Banks	$288.18 million	1.72	$46.75 million	$4.29	10.49

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

Insider & Institutional Ownership

64.9% of First Bank shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares First Bank and Dacotah Banks’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Bank	17.02%	9.60%	1.05%
Dacotah Banks	16.29%	N/A	N/A

Analyst Ratings

This is a summary of current ratings and recommmendations for First Bank and Dacotah Banks, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Bank	1	1	2	0	2.25
Dacotah Banks	0	0	0	0	0.00

First Bank presently has a consensus price target of $17.50, indicating a potential upside of 4.04%. Given First Bank’s stronger consensus rating and higher possible upside, analysts clearly believe First Bank is more favorable than Dacotah Banks.

Volatility and Risk

First Bank has a beta of 0.55, indicating that its share price is 45% less volatile than the S&P 500. Comparatively, Dacotah Banks has a beta of -0.04, indicating that its share price is 104% less volatile than the S&P 500.

Summary

First Bank beats Dacotah Banks on 9 of the 15 factors compared between the two stocks.

About First Bank

First Bank provides various banking products and services to small to mid-sized businesses and individuals. The company accepts various deposits, including non-interest-bearing demand deposits, interest bearing demand accounts, money market accounts, savings accounts, and certificates of deposit, as well as commercial checking accounts. It also offers various loan products comprising commercial and industrial loans, which include line of credit, inventory, equipment, and short-term working capital financing; commercial real estate loans, such as owner-occupied, investor, construction and development, and multi-family loans; residential real estate loans comprising residential mortgages, first and second lien home equity loans, and revolving lines of credit; and consumer and other loans consists of auto, personal, traditional installment, and other loans. The company also provides electronic banking services, including Internet and mobile banking, electronic bill payment, and banking by phone; ATM and debit cards, and wire and ACH transfer services; remote deposit capture; and cash management services, as well as engages in the capital markets activities. It operates full-service branches in Cinnaminson, Delanco, Denville, Ewing, Fairfield, Flemington, Hamilton, Lawrence, Monroe, Pennington, Randolph, Somerset, and Williamstown, New Jersey; Doylestown, Trevose, Warminster, and West Chester, Paoli, Malvern, Coventry, Devon, Lionville, and Glen Mills Pennsylvania; and Palm Beach, Florida. First Bank was incorporated in 2007 and is headquartered in Hamilton, New Jersey.

About Dacotah Banks

Dacotah Banks, Inc. provides various banking and financial products and services to individuals and businesses. The company provides demand and certificates of deposit; checking, individual retirement, health savings, and money market accounts; and commercial, commercial real estate, residential mortgage, and consumer loans. It also offers vehicle, boat, motorhome, mortgage, camper, motorcycle, snowmobile, jet SKI, and ATV loans; and unsecured, overdraft protection, and student loans; business, term, and small business administration loans, and other loans. In addition, the company provides credit, debit, and gift cards; mobile and online banking; auto, homeowner, health, and life insurance products; and estate, and trust services. Further, the company offers retirement planning, investment management, foundation, endowment, bill paying, charitable giving, and elder care services, as well as cash management services. Additionally, it provides offers operating lines of credit, state and federal programs, and equipment loans and leases. It also provides crop, homeowner, health, life, farm, and ranch insurance services; and farm and ranch management services. The company operates across various locations in Minnesota, North Dakota, and South Dakota. Dacotah Banks, Inc. was founded in 1955 and is headquartered in Aberdeen, South Dakota.