Mercantile Bank (NASDAQ: MBWM) is one of 199 publicly-traded companies in the “Commercial Banks” industry, but how does it contrast to its competitors? We will compare Mercantile Bank to similar businesses based on the strength of its valuation, profitability, institutional ownership, earnings, risk, analyst recommendations and dividends.

Earnings and Valuation

This table compares Mercantile Bank and its competitors revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Mercantile Bank $139.49 million $31.91 million 18.46
Mercantile Bank Competitors $343.96 million $72.97 million 21.25

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

Analyst Recommendations

This is a summary of recent ratings and target prices for Mercantile Bank and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mercantile Bank 0 3 0 0 2.00
Mercantile Bank Competitors 371 2907 2345 68 2.37

Mercantile Bank presently has a consensus target price of $34.50, suggesting a potential downside of 2.13%. As a group, “Commercial Banks” companies have a potential upside of 4.34%. Given Mercantile Bank’s competitors stronger consensus rating and higher possible upside, analysts plainly believe Mercantile Bank has less favorable growth aspects than its competitors.

Volatility & Risk

Mercantile Bank has a beta of 0.67, indicating that its share price is 33% less volatile than the S&P 500. Comparatively, Mercantile Bank’s competitors have a beta of 0.75, indicating that their average share price is 25% less volatile than the S&P 500.

Insider and Institutional Ownership

54.2% of Mercantile Bank shares are owned by institutional investors. Comparatively, 47.3% of shares of all “Commercial Banks” companies are owned by institutional investors. 3.2% of Mercantile Bank shares are owned by company insiders. Comparatively, 11.8% of shares of all “Commercial Banks” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Dividends

Mercantile Bank pays an annual dividend of $0.76 per share and has a dividend yield of 2.2%. Mercantile Bank pays out 39.8% of its earnings in the form of a dividend. As a group, “Commercial Banks” companies pay a dividend yield of 1.9% and pay out 35.6% of their earnings in the form of a dividend.

Profitability

This table compares Mercantile Bank and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mercantile Bank 22.18% 8.91% 1.00%
Mercantile Bank Competitors 20.50% 8.70% 0.93%

Summary

Mercantile Bank competitors beat Mercantile Bank on 10 of the 15 factors compared.

About Mercantile Bank

Mercantile Bank Corporation is a bank holding company. The Company owns the Mercantile Bank of Michigan (the Bank). The Bank is a state banking company. The Bank provides commercial banking services primarily to small- to medium-sized businesses and retail banking services. The Bank makes secured and unsecured commercial, construction, mortgage and consumer loans, and accepts checking, savings and time deposits. The Bank also enables customers to conduct certain loan and deposit transactions by personal computer and through mobile applications. Courier service is provided to certain commercial customers, and safe deposit facilities are available at its office locations. The Bank’s commercial lending group originates commercial loans and leases primarily in its market areas. The Bank’s primary deposit products are checking, savings and term certificate accounts.

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