Contrasting Limestone Bancorp (NASDAQ:LMST) & Emclaire Financial (NASDAQ:EMCF)

Limestone Bancorp (NASDAQ:LMSTGet Rating) and Emclaire Financial (NASDAQ:EMCFGet Rating) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, earnings, profitability, analyst recommendations, institutional ownership, valuation and dividends.

Valuation and Earnings

This table compares Limestone Bancorp and Emclaire Financial’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Limestone Bancorp $58.35 million 2.38 $14.91 million $1.96 10.72
Emclaire Financial $41.17 million 2.47 $10.17 million $3.63 10.23

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

Profitability

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

Net Margins Return on Equity Return on Assets
Limestone Bancorp 25.55% 11.85% 1.09%
Emclaire Financial 24.46% 11.23% 0.93%

Analyst Ratings

This is a summary of recent ratings and price targets for Limestone Bancorp and Emclaire Financial, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Limestone Bancorp 0 0 1 0 3.00
Emclaire Financial 0 0 0 0 N/A

Limestone Bancorp presently has a consensus target price of $22.00, suggesting a potential upside of 4.71%. Given Limestone Bancorp’s higher possible upside, analysts clearly believe Limestone Bancorp is more favorable than Emclaire Financial.

Institutional & Insider Ownership

42.9% of Limestone Bancorp shares are held by institutional investors. Comparatively, 10.8% of Emclaire Financial shares are held by institutional investors. 15.8% of Limestone Bancorp shares are held by insiders. Comparatively, 15.5% of Emclaire Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Limestone Bancorp pays an annual dividend of $0.20 per share and has a dividend yield of 1.0%. Emclaire Financial pays an annual dividend of $1.24 per share and has a dividend yield of 3.3%. Limestone Bancorp pays out 10.2% of its earnings in the form of a dividend. Emclaire Financial pays out 34.2% 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. Emclaire Financial has increased its dividend for 1 consecutive years. Emclaire Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Limestone Bancorp has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500. Comparatively, Emclaire Financial has a beta of 0.49, meaning that its stock price is 51% less volatile than the S&P 500.

Summary

Limestone Bancorp beats Emclaire Financial on 12 of the 16 factors compared between the two stocks.

Limestone Bancorp Company Profile (Get Rating)

Limestone Bancorp, Inc. operates as the bank holding company for Limestone Bank, Inc. that provides a range of commercial and personal banking products and services. The company offers deposit products, including savings, interest checking, and money market accounts, as well as fixed rate certificates with varying maturities. It also provides commercial loans for equipment purchases, working capital, and other financing needs of business enterprises; and commercial real estate loans that comprise loans on properties occupied by borrowers and tenants, as well as construction and development loans secured by land under development, or homes and commercial buildings under construction. In addition, the company offers residential real estate loans; consumer loans; agriculture loans secured by livestock, crops, and equipment; and other loans, including loans to municipalities, loans secured by stock, and overdrafts. Further, it provides drive-through banking facilities, automatic teller machines, personalized checks, credit and debit cards, electronic funds transfers through ACH services, domestic and foreign wire transfers, and loan and deposit sweep accounts; and curbside banking, night depository, internet and mobile banking, treasury management, remote deposit, cash management, and vault services. The company primarily serves communities and small to medium-sized businesses, the owners and employees of these businesses, and other executives and professionals. It operates 20 banking offices in 14 counties in Kentucky. The company was formerly known as Porter Bancorp, Inc. and changed its name to Limestone Bancorp, Inc. in May 2018. Limestone Bancorp, Inc. was founded in 1902 and is headquartered in Louisville, Kentucky.

Emclaire Financial Company Profile (Get Rating)

Emclaire Financial Corp. is a financial holding company, which engages in the provision of retail and commercial financial products and services to customers in western Pennsylvania through its wholly owned subsidiary bank, the Farmers National Bank of Emlenton. It offers residential mortgages, home equity and lines of credit, commercial real estate, commercial business, and consumer products and solutions. The firm operates through the following segments: Residential mortgages, and Home equity loans and lines of credit. The Residential mortgages segment provides loans to consumers utilized for the purchase, refinance or construction of a residence. The Home equity loans and lines of credit segment provides credit facilities extended to homeowners who wish to utilize the equity in their property in order to borrow funds for almost any consumer purpose. Emclaire Financial was founded in 1900 and is headquartered in Emlenton, PA.

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