CB Financial Services (NASDAQ: CBFV) and Valley National Bancorp (NYSE:VLY) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, institutional ownership, risk, profitability and earnings.

Institutional & Insider Ownership

19.9% of CB Financial Services shares are held by institutional investors. Comparatively, 63.5% of Valley National Bancorp shares are held by institutional investors. 9.7% of CB Financial Services shares are held by insiders. Comparatively, 3.1% of Valley National Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

CB Financial Services has a beta of 0.36, indicating that its stock price is 64% less volatile than the S&P 500. Comparatively, Valley National Bancorp has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500.

Profitability

This table compares CB Financial Services and Valley National Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CB Financial Services 19.02% 8.32% 0.87%
Valley National Bancorp 19.91% 8.27% 0.81%

Dividends

CB Financial Services pays an annual dividend of $0.88 per share and has a dividend yield of 3.0%. Valley National Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 4.0%. CB Financial Services pays out 47.6% of its earnings in the form of a dividend. Valley National Bancorp pays out 64.7% 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.

Earnings and Valuation

This table compares CB Financial Services and Valley National Bancorp’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
CB Financial Services $39.38 million 3.08 $7.58 million $1.85 16.03
Valley National Bancorp $870.15 million 3.35 $168.14 million $0.68 16.22

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

Analyst Ratings

This is a summary of current ratings for CB Financial Services and Valley National Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CB Financial Services 0 1 1 0 2.50
Valley National Bancorp 0 5 2 0 2.29

CB Financial Services currently has a consensus price target of $30.50, indicating a potential upside of 2.87%. Valley National Bancorp has a consensus price target of $12.60, indicating a potential upside of 14.23%. Given Valley National Bancorp’s higher possible upside, analysts plainly believe Valley National Bancorp is more favorable than CB Financial Services.

Summary

Valley National Bancorp beats CB Financial Services on 9 of the 16 factors compared between the two stocks.

About CB Financial Services

CB Financial Services, Inc. is the bank holding company for Community Bank (the Bank). The Company operates in community banking segment. The Bank offers residential and commercial real estate loans, commercial and industrial loans, and consumer loans, as well as a range of deposit products for individuals and businesses in its market area. The Bank operates through a network of approximately 20 offices in Greene, Allegheny, Washington, Fayette and Westmoreland Counties in southwestern Pennsylvania. The Company’s principal lending activity is the origination of residential loans secured by one- to four-family residential properties in its local market area. In addition, the Bank offers property and casualty, commercial liability, surety and other insurance products, through its subsidiary, Exchange Underwriters, Inc. (Exchange Underwriters), an independent insurance agency.

About Valley National Bancorp

Valley National Bancorp is the bank holding company for Valley National Bank (the Bank). The Bank provides a range of commercial, retail, insurance and wealth management financial services products. The Company’s segments include Consumer Lending, Commercial Lending, Investment Management, and Corporate and Other Adjustments. The Consumer Lending segment primarily includes residential mortgages, home equity loans and automobile loans. The Commercial Lending segment primarily includes floating rate and adjustable rate commercial and industrial loans, as well as fixed rate owner occupied and commercial real estate loans. The Investment Management segment includes the Company’s investments in various types of securities. As of July 26, 2017, the Bank operated 200 branch locations serving northern and central New Jersey, the New York City boroughs of Manhattan, Brooklyn, Queens and Long Island, and Florida.

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