Critical Contrast: Green Bancorp (NASDAQ:GNBC) & Emclaire Financial (NASDAQ:EMCF)

Emclaire Financial (NASDAQ:EMCF) and Green Bancorp (NASDAQ:GNBC) 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, risk, institutional ownership, profitability, valuation, analyst recommendations and dividends.

Analyst Recommendations

This is a breakdown of recent ratings for Emclaire Financial and Green Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Emclaire Financial 0 0 0 0 N/A
Green Bancorp 0 1 2 0 2.67

Green Bancorp has a consensus target price of $29.00, indicating a potential upside of 69.19%. Given Green Bancorp’s higher probable upside, analysts clearly believe Green Bancorp is more favorable than Emclaire Financial.

Profitability

This table compares Emclaire Financial and Green Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Emclaire Financial 14.54% 7.96% 0.66%
Green Bancorp 20.51% 12.15% 1.34%

Institutional & Insider Ownership

6.4% of Emclaire Financial shares are held by institutional investors. Comparatively, 68.3% of Green Bancorp shares are held by institutional investors. 16.6% of Emclaire Financial shares are held by company insiders. Comparatively, 14.0% of Green Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Emclaire Financial and Green Bancorp’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Emclaire Financial $35.17 million 2.76 $4.21 million N/A N/A
Green Bancorp $190.76 million 3.36 $34.13 million $1.21 14.17

Green Bancorp has higher revenue and earnings than Emclaire Financial.

Volatility & Risk

Emclaire Financial has a beta of 0.44, meaning that its share price is 56% less volatile than the S&P 500. Comparatively, Green Bancorp has a beta of 2.05, meaning that its share price is 105% more volatile than the S&P 500.

Dividends

Emclaire Financial pays an annual dividend of $1.16 per share and has a dividend yield of 3.2%. Green Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.3%. Green Bancorp pays out 33.1% of its earnings in the form of a dividend. Emclaire Financial has raised its dividend for 3 consecutive years. Emclaire Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Green Bancorp beats Emclaire Financial on 10 of the 15 factors compared between the two stocks.

Emclaire Financial Company Profile

Emclaire Financial Corp operates as the bank holding company for The Farmers National Bank of Emlenton that provides retail and commercial financial products and services to individuals and businesses in western Pennsylvania. The company's deposit products include checking, savings, and term certificate accounts; time deposits; noninterest bearing and interest bearing demand deposit accounts; and money market accounts. Its loan portfolio comprises one-to-four family mortgage loans, residential and commercial mortgages loans, home equity loans, and commercial business and commercial real estate loans; and consumer loans, such as loans for automobile purchases, home improvements not secured by real estate, capital, and other personal expenditures, as well as unsecured revolving personal lines of credit and overdraft protection. The company, through its subsidiary, Emclaire Settlement Services, LLC, also provides real estate settlement services. As of February 20, 2019, it operated 20 full service offices in Venango, Allegheny, Butler, Clarion, Clearfield, Crawford, Elk, Jefferson, and Mercer counties in Pennsylvania, as well as in Hancock County, West Virginia. The company was founded in 1900 and is headquartered in Emlenton, Pennsylvania.

Green Bancorp Company Profile

Green Bancorp, Inc. operates as the bank holding company for Green Bank, N.A. that provides commercial and private banking services primarily in Texas. It offers deposit accounts, such as demand, savings, money market, and time accounts. The company also provides loans, including commercial and industrial loans, including commercial lines of credit, working capital loans, commercial real estate-backed loans, mortgage-warehouse lines, term loans, equipment financing, borrowing base loans, real estate construction loans, homebuilder loans, government guaranteed loans, purchased receivables financing, letters of credit, and other loan products, as well as acquisition, expansion, and development loans to national and regional companies, real estate developers, mortgage lenders, manufacturing and industrial companies, and other businesses. In addition, it offers various consumer loans, such as residential real estate loans, home equity loans, installment loans, unsecured and secured personal lines of credit, overdraft protection, and letters of credit. Further, the company provides a range of online banking solutions, including access to account balances, online transfers, online bill payment, and electronic delivery of customer statements; and extended drive-through hours, and ATMs, as well as banking through telephone, mail, and personal appointment. Additionally, it offers debit cards, night depository services, direct deposits, and cashier's checks, as well as treasury management, wire transfer, and automated clearing house services. The company provides its services through 22 full service branches in the greater Houston and Dallas metropolitan areas, as well as in Austin, Louisville, and Honey Grove. Green Bancorp, Inc. was founded in 1999 and is headquartered in Houston, Texas.

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