Head to Head Survey: Primis Financial (NASDAQ:FRST) and Southern Michigan Bancorp (OTCMKTS:SOMC)

Primis Financial (NASDAQ:FRST) and Southern Michigan Bancorp (OTCMKTS:SOMC) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their earnings, analyst recommendations, profitability, risk, valuation, institutional ownership and dividends.

Profitability

This table compares Primis Financial and Southern Michigan Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Primis Financial	8.73%	5.90%	0.58%
Southern Michigan Bancorp	14.88%	11.76%	0.78%

Dividends

Primis Financial pays an annual dividend of $0.40 per share and has a dividend yield of 3.7%. Southern Michigan Bancorp pays an annual dividend of $0.60 per share and has a dividend yield of 3.6%. Primis Financial pays out 46.5% of its earnings in the form of a dividend. Southern Michigan Bancorp pays out 25.0% 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.

Insider and Institutional Ownership

75.0% of Primis Financial shares are held by institutional investors. 10.6% of Primis Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

Primis Financial has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500. Comparatively, Southern Michigan Bancorp has a beta of 0.28, suggesting that its stock price is 72% less volatile than the S&P 500.

Valuation & Earnings

This table compares Primis Financial and Southern Michigan Bancorp’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Primis Financial	$244.23 million	1.10	$9.94 million	$0.86	12.60
Southern Michigan Bancorp	$73.31 million	1.05	$10.90 million	$2.40	7.00

Southern Michigan Bancorp has lower revenue, but higher earnings than Primis Financial. Southern Michigan Bancorp is trading at a lower price-to-earnings ratio than Primis Financial, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Primis Financial and Southern Michigan Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Primis Financial	0	0	0	0	N/A
Southern Michigan Bancorp	0	0	0	0	N/A

Summary

Primis Financial beats Southern Michigan Bancorp on 7 of the 13 factors compared between the two stocks.

About Primis Financial

Primis Financial Corp. operates as the bank holding company for Primis Bank that provides a range of financial services to individuals and small and medium sized businesses in the United States. Its deposit products include checking, NOW, savings, and money market accounts, as well as certificates of deposits. The company also provides commercial business and real estate, construction, secured asset based, small business administration, mortgage warehouse lending products, as well as financing for medical, dental, and veterinary businesses; residential mortgage, trust mortgage, home equity lines of credit, secured and unsecured personal, and consumer loans, as well as life insurance premium financing and demand loans. It also offers cash management services comprising investment/sweep, zero balance, and controlled disbursement accounts; and wire transfer, employer/payroll processing, night depository, depository transfer, merchant, ACH origination, and remote deposit capture services. In addition, the company provides debit cards, ATM services, notary services, and mobile and online banking. It operates full-service branches in Virginia and Maryland. The company was formerly known as Southern National Bancorp of Virginia, Inc. and changed its name to Primis Financial Corp. Primis Financial Corp. was founded in 2004 and is based in McLean, Virginia.

About Southern Michigan Bancorp

Southern Michigan Bancorp, Inc. operates as the bank holding company for Southern Michigan Bank & Trust that provides a range of commercial banking services to individuals, businesses, institutions, and governmental agencies primarily in the southwest Michigan communities. Its deposit products include interest and non-interest checking, savings, and various types of money market accounts; time, savings, and demand deposits; and certificates of deposit and IRAs. The company also provides home mortgages and equity loans, home equity lines of credit, VA and FHA home loans, USDA rural development loans, and auto/personal loans; business loans, such as lines of credit, term loans, commercial real estate loans, commercial and industrial loans, agriculture loans, letters of credit, small business administration loans, and capital access loans; industrial, construction, real estate, and inventory loans; and consumer lending products comprising direct and indirect loans to purchasers of residential real property and consumer goods. In addition, it offers trust and investment services that include investment management, trustee, IRA rollovers and retirement plan, institutional and personal custody, estate settlement, wealth management, estate and wealth transfer planning assistance, charitable gift planning assistance, and cash management custody services; and safe deposit box and automated teller machine services. Further, the company provides bill pay, e-statements, ACH, wire transfer, remote deposit capture, and insurance services, as well as ATM, debit, credit, and gift cards. The company was founded in 1871 and is based in Coldwater, Michigan.