German American Bancorp (GABC) and Its Peers Critical Review

German American Bancorp (NASDAQ:GABC) is one of 919 publicly-traded companies in the “Banks” industry, but how does it contrast to its peers? We will compare German American Bancorp to related companies based on the strength of its analyst recommendations, institutional ownership, dividends, valuation, earnings, profitability and risk.

Dividends

German American Bancorp pays an annual dividend of $1.24 per share and has a dividend yield of 2.4%. German American Bancorp pays out 32.0% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 9.2% and pay out 28.9% of their earnings in the form of a dividend. German American Bancorp has raised its dividend for 13 consecutive years. German American Bancorp lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Institutional and Insider Ownership

46.9% of German American Bancorp shares are owned by institutional investors. Comparatively, 48.0% of shares of all “Banks” companies are owned by institutional investors. 3.2% of German American Bancorp shares are owned by company insiders. Comparatively, 9.8% of shares of all “Banks” companies are owned 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.

Profitability

This table compares German American Bancorp and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
German American Bancorp	28.78%	12.33%	1.74%
German American Bancorp Competitors	15.64%	9.43%	0.93%

Analyst Ratings

This is a summary of recent ratings and recommmendations for German American Bancorp and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
German American Bancorp	0	2	2	2	3.00
German American Bancorp Competitors	7470	30199	27764	1466	2.35

German American Bancorp currently has a consensus target price of $53.33, indicating a potential upside of 3.89%. As a group, “Banks” companies have a potential upside of 15.22%. Given German American Bancorp’s peers higher probable upside, analysts clearly believe German American Bancorp has less favorable growth aspects than its peers.

Risk and Volatility

German American Bancorp has a beta of 0.62, suggesting that its stock price is 38% less volatile than the S&P 500. Comparatively, German American Bancorp’s peers have a beta of 0.61, suggesting that their average stock price is 39% less volatile than the S&P 500.

Valuation & Earnings

This table compares German American Bancorp and its peers gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
German American Bancorp	$394.24 million	$112.64 million	13.23
German American Bancorp Competitors	$37.92 billion	$2.42 billion	17.45

German American Bancorp’s peers have higher revenue and earnings than German American Bancorp. German American Bancorp is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

German American Bancorp peers beat German American Bancorp on 9 of the 15 factors compared.

About German American Bancorp

German American Bancorp, Inc. operates as a financial holding company for German American Bank that provides retail and commercial banking services. The company operates through three segments: Core Banking, Wealth Management Services, and Insurance Operations. The Core Banking segment accepts deposits from the general public; and originates consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, as well as sells residential mortgage loans in the secondary market. The Wealth Management segment provides trust, investment advisory, brokerage, and retirement planning services. The Insurance Operations segment offers a range of personal and corporate property and casualty insurance products. It also offers checking, saving, and individual retirement accounts; certificates of deposit; wire transfer; credit cards; home equity, mortgages, and small business; treasury management; and online and mobile banking, bill pay, digital wallet, mobile check deposit, credit score and report, money management, and estatements, as well as wealth advisory. German American Bancorp, Inc. was founded in 1910 and is based in Jasper, Indiana.