Central Pacific Financial (NYSE:CPF) and First Internet Bancorp (NASDAQ:INBK) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, valuation, profitability, analyst recommendations, earnings and dividends.
Earnings & Valuation
This table compares Central Pacific Financial and First Internet Bancorp’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Central Pacific Financial||$237.10 million||3.47||$59.49 million||$2.01||14.29|
|First Internet Bancorp||$124.23 million||1.73||$21.90 million||$2.50||8.54|
Central Pacific Financial has higher revenue and earnings than First Internet Bancorp. First Internet Bancorp is trading at a lower price-to-earnings ratio than Central Pacific Financial, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Central Pacific Financial has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500. Comparatively, First Internet Bancorp has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500.
This is a breakdown of current ratings and recommmendations for Central Pacific Financial and First Internet Bancorp, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Central Pacific Financial||0||0||0||0||N/A|
|First Internet Bancorp||0||3||1||0||2.25|
First Internet Bancorp has a consensus target price of $31.25, indicating a potential upside of 46.30%. Given First Internet Bancorp’s higher probable upside, analysts clearly believe First Internet Bancorp is more favorable than Central Pacific Financial.
This table compares Central Pacific Financial and First Internet Bancorp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Central Pacific Financial||24.93%||12.54%||1.06%|
|First Internet Bancorp||16.21%||8.15%||0.69%|
Central Pacific Financial pays an annual dividend of $0.84 per share and has a dividend yield of 2.9%. First Internet Bancorp pays an annual dividend of $0.24 per share and has a dividend yield of 1.1%. Central Pacific Financial pays out 41.8% of its earnings in the form of a dividend. First Internet Bancorp pays out 9.6% 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. Central Pacific Financial has raised its dividend for 3 consecutive years. Central Pacific Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Insider & Institutional Ownership
96.1% of Central Pacific Financial shares are held by institutional investors. Comparatively, 68.8% of First Internet Bancorp shares are held by institutional investors. 3.8% of Central Pacific Financial shares are held by insiders. Comparatively, 5.6% of First Internet Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Central Pacific Financial beats First Internet Bancorp on 11 of the 16 factors compared between the two stocks.
Central Pacific Financial Company Profile
Central Pacific Financial Corp. operates as the holding company for Central Pacific Bank that provides commercial banking products and services to businesses, professionals, and individuals in Hawaii. The company operates in three segments: Banking Operations, Treasury, and All Others. It offers various deposit products and services, including personal and business checking and savings accounts, money market accounts, and time certificates of deposit. The company's lending activities comprise commercial loans, commercial mortgages, construction loans, and leases to small and medium-sized companies, business professionals, and real estate investors and developers, as well as residential mortgages and consumer loans to local homebuyers and individuals. It also provides debit cards, Internet and mobile banking, cash management services, traveler's checks, safe deposit boxes, international banking services, night depository facilities, foreign exchange and wire transfers, trust services, retail brokerage, and wholesale funding services. In addition, the company offers wealth management products and services, including non-deposit investment products, annuities, insurance, investment management, asset custody, and general consultation and planning services. It operates 35 branches and 79 ATMs in the state of Hawaii. The company was founded in 1954 and is headquartered in Honolulu, Hawaii.
First Internet Bancorp Company Profile
First Internet Bancorp operates as a bank holding company for First Internet Bank of Indiana that provides commercial and retail banking products and services in the United States. The company offers savings and money market accounts, non-interest bearing and interest-bearing demand deposits, brokered deposit accounts, and certificates of deposit. It also provides commercial and industrial, owner-occupied commercial real estate, investor commercial real estate, construction, residential mortgage, term, small installment, home improvement, home equity, and other consumer loans, as well as single tenant lease financing, public and healthcare finance, lines of credit, and letters of credit to individuals and commercial customers. In addition, the company is involved in the purchase, manage, service, and safekeeping of municipal securities; and offers municipal lending and leasing products to government entities. In addition, it provides corporate credit card and treasury management services. The company offers its services through its Website, www.firstib.com. First Internet Bancorp was founded in 1999 and is based in Fishers, Indiana.
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