Analyzing Farmers & Merchants Bancorp (NASDAQ:FMAO) and Shore Community Bank (OTCMKTS:SHRC)

Shore Community Bank (OTCMKTS:SHRC) and Farmers & Merchants Bancorp (NASDAQ:FMAO) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, earnings, dividends and analyst recommendations.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Shore Community Bank and Farmers & Merchants Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shore Community Bank	0	0	0	0	0.00
Farmers & Merchants Bancorp	0	3	1	0	2.25

Farmers & Merchants Bancorp has a consensus target price of $30.25, indicating a potential downside of 0.31%. Given Farmers & Merchants Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe Farmers & Merchants Bancorp is more favorable than Shore Community Bank.

Valuation and Earnings

This table compares Shore Community Bank and Farmers & Merchants Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shore Community Bank	N/A	N/A	N/A	N/A	N/A
Farmers & Merchants Bancorp	$121.83 million	3.43	$33.31 million	$2.61	11.63

Farmers & Merchants Bancorp has higher revenue and earnings than Shore Community Bank.

Profitability

This table compares Shore Community Bank and Farmers & Merchants Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shore Community Bank	N/A	N/A	N/A
Farmers & Merchants Bancorp	18.54%	9.85%	1.05%

Insider and Institutional Ownership

24.0% of Farmers & Merchants Bancorp shares are held by institutional investors. 7.3% of Farmers & Merchants Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Farmers & Merchants Bancorp beats Shore Community Bank on 9 of the 9 factors compared between the two stocks.

About Shore Community Bank

Shore Community Bank, a state chartered bank, provides banking products and services to businesses and individuals in Ocean County, New Jersey. The company's deposit products include checking accounts, savings accounts, certificates of deposit, individual retirement accounts, money market accounts, visa/mastercard merchant deposit accounts, and payroll/direct deposit accounts. Its loan portfolio comprises personal, home equity, term, and demand loans; lines of credit; letters of credit; commercial mortgages; and construction lending. The company also offers direct deposit and electronic transfer, wire transfer, ACH origination, night depository, tenant rent security, signature guarantee, remote deposit, notary, and automated asset management services; safe deposit boxes, escrow accounts, and debit cards, as well as online and telephone banking services. As of April 28, 2016, it operated five banking offices located in Toms River, Jackson, and Manahawkin, New Jersey. Shore Community Bank was incorporated in 1996 and is headquartered in Toms River, New Jersey.

About Farmers & Merchants Bancorp

Farmers & Merchants Bancorp, Inc. is a bank holding company, which engages in the provision of commercial banking, retail banking, and financial services. It includes commercial, agricultural, and residential mortgages as well as consumer and credit card lending activities. The firm also offers checking account services, and savings and time deposit services. The company was founded in 1985 and is headquartered in Archbold, OH.