City (NASDAQ:CHCO) versus First Northern Community Bancorp (NASDAQ:FNRN) Financial Analysis

First Northern Community Bancorp (NASDAQ:FNRN) and City (NASDAQ:CHCO) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, analyst recommendations, earnings, dividends and profitability.

Insider & Institutional Ownership

17.9% of First Northern Community Bancorp shares are owned by institutional investors. Comparatively, 72.4% of City shares are owned by institutional investors. 11.9% of First Northern Community Bancorp shares are owned by company insiders. Comparatively, 1.8% of City shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares First Northern Community Bancorp and City”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Northern Community Bancorp	$88.40 million	3.19	$21.13 million	$1.35	12.72
City	$398.98 million	5.00	$130.49 million	$9.14	15.53

City has higher revenue and earnings than First Northern Community Bancorp. First Northern Community Bancorp is trading at a lower price-to-earnings ratio than City, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations and price targets for First Northern Community Bancorp and City, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Northern Community Bancorp	0	0	1	0	3.00
City	0	2	1	0	2.33

City has a consensus target price of $136.50, suggesting a potential downside of 3.85%. Given City’s higher probable upside, analysts plainly believe City is more favorable than First Northern Community Bancorp.

Profitability

This table compares First Northern Community Bancorp and City’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Northern Community Bancorp	24.97%	10.68%	1.18%
City	32.58%	16.34%	1.95%

Summary

City beats First Northern Community Bancorp on 10 of the 12 factors compared between the two stocks.

About First Northern Community Bancorp

First Northern Community Bancorp operates as the bank holding company for First Northern Bank of Dixon that provides commercial banking products and services to individuals, and small to medium sized businesses. The company accepts demand deposits, interest-bearing transaction deposits, savings and money market accounts, and time deposits. Its loan portfolio comprises of commercial, commercial real estate, agriculture, residential mortgage, residential construction, and consumer loans. The company also offers credit cards; investment and brokerage services; alternative investment products, and fiduciary and other financial services; and equipment leasing, merchant card processing, payroll, and international banking services through third parties. In addition, it provides issues cashier’s checks, safe deposit boxes rental, and other customary banking services. The company operates eleven full-service branches located in the cities of Auburn, Davis, Dixon, Fairfield, Rancho Cordova, Roseville, Sacramento, Vacaville, West Sacramento, Winters, and Woodland; a satellite banking office inside a retirement community in the city of Davis; a residential mortgage loan office in Davis; and a commercial loan office in the Contra Costa County city of Walnut Creek. First Northern Community Bancorp was founded in 1910 and is headquartered in Dixon, California.

About City

City Holding Company operates as a holding company for City National Bank of West Virginia that provides various banking, trust, and investment management, and other financial solutions in the United States. The company offers checking, savings, and money market accounts, as well as certificates of deposit and individual retirement accounts. It also provides commercial and industrial loans that consist of loans to corporate and other legal entity borrowers primarily in small to mid-size industrial and commercial companies; commercial real estate loans comprising commercial mortgages, which are secured by nonresidential and multi-family residential properties; residential real estate loans to consumers for the purchase or refinance of residence; first-priority home equity loans; home equity lines of credit; amortized home equity loans; consumer loans that are secured and unsecured by automobiles, boats, recreational vehicles, certificates of deposit, and other personal property; and demand deposit account overdrafts, as well as owner-occupied real estate and construction, land development, and lines of credit. In addition, the company offers mortgage banking services, including fixed and adjustable-rate mortgages, construction financing, land loans, production of conventional and government-insured mortgages, secondary marketing, and mortgage servicing. Further, it provides deposit services for commercial customers comprising treasury management, lockbox, and other cash management services; merchant credit card services; wealth management, trust, investment, and custodial services for commercial and individual customers; and corporate trust and institutional custody, financial and estate planning, and retirement plan services, as well as automated-teller-machine, interactive-teller-machine, mobile banking, interactive voice response systems, and credit and debit card services. City Holding Company was founded in 1957 and is headquartered in Charleston, West Virginia.