Equity BancShares (NASDAQ: GFED) and Guaranty Federal Bancshares (NASDAQ:GFED) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitability, risk and dividends.
This is a summary of current ratings and recommmendations for Equity BancShares and Guaranty Federal Bancshares, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Guaranty Federal Bancshares||0||0||1||0||3.00|
Guaranty Federal Bancshares pays an annual dividend of $0.48 per share and has a dividend yield of 1.9%. Equity BancShares does not pay a dividend. Guaranty Federal Bancshares pays out 32.9% of its earnings in the form of a dividend. Guaranty Federal Bancshares has raised its dividend for 3 consecutive years.
Earnings & Valuation
This table compares Equity BancShares and Guaranty Federal Bancshares’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Equity BancShares||$118.13 million||5.09||$20.64 million||$1.98||20.79|
|Guaranty Federal Bancshares||$35.17 million||3.16||$5.15 million||$1.46||17.09|
Equity BancShares has higher revenue and earnings than Guaranty Federal Bancshares. Guaranty Federal Bancshares is trading at a lower price-to-earnings ratio than Equity BancShares, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Equity BancShares has a beta of 0.52, indicating that its stock price is 48% less volatile than the S&P 500. Comparatively, Guaranty Federal Bancshares has a beta of -0.01, indicating that its stock price is 101% less volatile than the S&P 500.
This table compares Equity BancShares and Guaranty Federal Bancshares’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Guaranty Federal Bancshares||8.51%||9.16%||0.87%|
Insider and Institutional Ownership
61.9% of Equity BancShares shares are owned by institutional investors. Comparatively, 26.8% of Guaranty Federal Bancshares shares are owned by institutional investors. 12.2% of Equity BancShares shares are owned by insiders. Comparatively, 29.5% of Guaranty Federal Bancshares shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Equity BancShares beats Guaranty Federal Bancshares on 12 of the 16 factors compared between the two stocks.
About Equity BancShares
Equity Bancshares, Inc. operates as a bank holding company for Equity Bank that provides a range of financial services primarily to businesses, business owners, and individuals. The company accepts various deposit products, including demand, savings, money market, and time deposits. Its loan products include commercial and industrial, commercial real estate-backed, commercial lines of credit, working capital, term, equipment financing, acquisition, expansion and development, borrowing base, real estate construction loans, homebuilder, agricultural, government guaranteed, and other loans, as well as letters of credit to national and regional companies, restaurant franchisees, hoteliers, real estate developers, manufacturing and industrial companies, agribusiness companies, and other businesses. The company's loan products also comprise various consumer loans to individuals and professionals, including residential real estate loans, home equity loans, home equity lines of credit, installment loans, unsecured and secured personal lines of credit, overdraft protection, and letters of credit. It also provides debit cards; online banking solutions, such as access to account balances, online transfers, online bill payment, and electronic delivery of customer statements; mobile banking solutions comprising remote check deposits with mobile bill pay; ATMs; and treasury management, wire transfer, and automated clearing house and stop payment services. In addition, the company offers cash management deposit products, such as lockbox, remote deposit capture, positive pay, reverse positive pay, account reconciliation services, zero balance accounts, and sweep accounts, as well as banking services through telephone, mail, and personal appointments. As of February 22, 2018, it operated 42 full-service branches located in Kansas, Missouri, Arkansas, and Oklahoma. Equity Bancshares, Inc. was founded in 2002 and is headquartered in Wichita, Kansas.
About Guaranty Federal Bancshares
Guaranty Federal Bancshares, Inc. operates as the bank holding company for Guaranty Bank that provides banking products and services in the southwestern corner of Missouri. The company's deposit products include checking accounts, money market accounts, savings accounts, fixed-term certificates of deposit, and individual retirement accounts, as well as demand deposits and NOW accounts. Its loan portfolio comprises commercial real estate loans, one-to four-family mortgage loans, multi-family residential mortgage loans, and construction loans; and consumer and other loans, such as loans secured by certificates of deposit, automobile loans, boat loans, and home equity loans, as well as business loans. As of April 18, 2017, the company had nine full-service branches in Greene and Christian Counties; and loan production offices in Jasper and Webster Counties. It also provides access to approximately 24,000 ATMs. Guaranty Federal Bancshares, Inc. was founded in 1913 and is based in Springfield, Missouri.
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