Analyzing Potomac Bancshares (OTCMKTS:PTBS) & Orange County Bancorp (NASDAQ:OBT)

Potomac Bancshares (OTCMKTS:PTBS) and Orange County Bancorp (NASDAQ:OBT) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, risk, valuation, earnings and dividends.

Dividends

Potomac Bancshares pays an annual dividend of $0.52 per share and has a dividend yield of 2.8%. Orange County Bancorp pays an annual dividend of $0.52 per share and has a dividend yield of 2.2%. Potomac Bancshares pays out 26.9% of its earnings in the form of a dividend. Orange County Bancorp pays out 20.3% 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 & Institutional Ownership

5.3% of Potomac Bancshares shares are held by institutional investors. Comparatively, 42.6% of Orange County Bancorp shares are held by institutional investors. 4.4% of Potomac Bancshares shares are held by insiders. Comparatively, 9.3% of Orange County Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Risk & Volatility

Potomac Bancshares has a beta of 0.23, meaning that its stock price is 77% less volatile than the S&P 500. Comparatively, Orange County Bancorp has a beta of 0.45, meaning that its stock price is 55% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Potomac Bancshares and Orange County Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Potomac Bancshares	0	0	0	0	0.00
Orange County Bancorp	0	2	2	0	2.50

Orange County Bancorp has a consensus price target of $29.25, indicating a potential upside of 24.47%. Given Orange County Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Orange County Bancorp is more favorable than Potomac Bancshares.

Profitability

This table compares Potomac Bancshares and Orange County Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Potomac Bancshares	N/A	N/A	N/A
Orange County Bancorp	19.84%	14.19%	1.16%

Valuation & Earnings

This table compares Potomac Bancshares and Orange County Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Potomac Bancshares	$48.09 million	N/A	N/A	$1.93	9.47
Orange County Bancorp	$128.82 million	2.44	$27.88 million	$2.56	9.18

Orange County Bancorp has higher revenue and earnings than Potomac Bancshares. Orange County Bancorp is trading at a lower price-to-earnings ratio than Potomac Bancshares, indicating that it is currently the more affordable of the two stocks.

Summary

Orange County Bancorp beats Potomac Bancshares on 12 of the 14 factors compared between the two stocks.

About Potomac Bancshares

Potomac Bancshares, Inc. operates as the bank holding company for Bank of Charles Town that provides various banking products and services to individuals and businesses. The company offers checking, savings, and individual retirement accounts; and certificates of deposit (CD). It also provides personal loans, including new and used vehicle, home equity, unsecured home improvement and personal, retail equipment, and lot loans, as well as loans secured by CD, and home equity lines of credit; commercial loans for building or office purchases, commercial real estate and construction, and production and administrative equipment purchases; lines of credit; mortgage, commercial, term, residential and commercial construction, commercial real estate, and agricultural loans; and credit and debit cards. In addition, the company offers Card Pay, cash management, merchant, financial planning, trust and estate, investment management, wealth management, full-service brokerage, retirement and insurance planning and products, asset allocation and management, and college planning services, as well as telephone, mobile, and online banking services. Potomac Bancshares, Inc. was founded in 1871 and is based in Charles Town, West Virginia.

About Orange County Bancorp

Orange County Bancorp, Inc., through its subsidiaries, provides commercial and consumer banking products and services, and trust and wealth management services to small businesses, middle-market enterprises, local municipal governments, and individuals. It accepts various deposits, including interest-bearing and noninterest-bearing demand accounts, money market deposit accounts, savings accounts, and certificates of deposit. The company also offers commercial real estate loans, commercial and industrial loans, commercial real estate construction loans, residential real estate loans, home equity loans, and consumer loans. In addition, it provides traditional trust and administration, asset management, financial planning, and wealth management services. The company operates full-service branches and loan production office in Orange, Westchester, Rockland, and Bronx counties in New York. Orange County Bancorp, Inc. was founded in 1892 and is headquartered in Middletown, New York.