1st Source Corporation (NASDAQ: SRCE) and Washington Banking (NASDAQ:WBCO) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, earnings, analyst recommendations, risk and valuation.

Dividends

1st Source Corporation pays an annual dividend of $0.76 per share and has a dividend yield of 1.6%. Washington Banking does not pay a dividend. 1st Source Corporation pays out 31.8% of its earnings in the form of a dividend. Washington Banking has raised its dividend for 31 consecutive years.

Valuation and Earnings

This table compares 1st Source Corporation and Washington Banking’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
1st Source Corporation $261.58 million 4.80 $61.98 million $2.39 20.26
Washington Banking N/A N/A N/A N/A N/A

1st Source Corporation has higher revenue and earnings than Washington Banking.

Insider & Institutional Ownership

70.2% of 1st Source Corporation shares are owned by institutional investors. 20.3% of 1st Source Corporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares 1st Source Corporation and Washington Banking’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
1st Source Corporation 21.41% 9.14% 1.13%
Washington Banking N/A N/A N/A

Analyst Recommendations

This is a summary of current recommendations and price targets for 1st Source Corporation and Washington Banking, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
1st Source Corporation 0 1 1 0 2.50
Washington Banking 0 0 0 0 N/A

1st Source Corporation presently has a consensus target price of $51.00, suggesting a potential upside of 5.31%. Given 1st Source Corporation’s higher probable upside, research analysts clearly believe 1st Source Corporation is more favorable than Washington Banking.

Summary

1st Source Corporation beats Washington Banking on 9 of the 11 factors compared between the two stocks.

1st Source Corporation Company Profile

1st Source Corporation is a bank holding company. The Company, through its subsidiaries, provides a range of financial products and services. It is engaged in commercial banking. 1st Source Bank (Bank), its banking subsidiary, offers commercial and consumer banking services, trust and wealth advisory services, and insurance to individual and business clients. The Bank offers a range of consumer and commercial banking services through its lending operations, retail branches and fee based businesses. It provides commercial, small business, agricultural, and real estate loans to primarily business clients mainly located within its regional market area. It provides a range of consumer banking products and services through its banking centers and at 1stsource.com. It also offers insurance products through 1st Source Insurance offices. It also provides a range of trust, investment, agency, and custodial services for individual, corporate and not-for-profit clients.

Washington Banking Company Profile

Washington Banking Company is a bank holding company. The Company’s primary business is conducted by its wholly owned subsidiary, Whidbey Island Bank (the Bank). The business of the Bank, which is focused in the northern area of Western Washington, consists primarily of attracting deposits from the general public and originating loans. Whidbey Island Bank conducts a full-service, community, commercial banking business. The Bank also offers nondeposit managed investment products and services, which are not Federal Deposit Insurance Corporation (FDIC) insured. These programs are provided through the investment advisory companies Elliott Cove Capital Management LLC and DFC Services & DFC Insurance Services. Another nondeposit product offered through the Bank, which is not FDIC insured, is a sweep investment option available through a brokerage account.

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