Norwood Financial (NASDAQ:NWFL – Get Rating) and Bank of the James Financial Group (NASDAQ:BOTJ – Get Rating) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, risk, institutional ownership, profitability, valuation and earnings.
Norwood Financial pays an annual dividend of $1.12 per share and has a dividend yield of 4.0%. Bank of the James Financial Group pays an annual dividend of $0.28 per share and has a dividend yield of 1.9%. Norwood Financial pays out 34.7% of its earnings in the form of a dividend. Bank of the James Financial Group pays out 16.9% 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. Norwood Financial has increased its dividend for 7 consecutive years and Bank of the James Financial Group has increased its dividend for 2 consecutive years. Norwood Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares Norwood Financial and Bank of the James Financial Group’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Norwood Financial||$79.39 million||2.91||$24.92 million||$3.23||8.72|
|Bank of the James Financial Group||$40.39 million||1.71||$7.59 million||$1.66||8.75|
Norwood Financial has higher revenue and earnings than Bank of the James Financial Group. Norwood Financial is trading at a lower price-to-earnings ratio than Bank of the James Financial Group, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Norwood Financial has a beta of 0.44, meaning that its share price is 56% less volatile than the S&P 500. Comparatively, Bank of the James Financial Group has a beta of 0.98, meaning that its share price is 2% less volatile than the S&P 500.
This is a breakdown of current recommendations and price targets for Norwood Financial and Bank of the James Financial Group, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Bank of the James Financial Group||0||0||0||0||N/A|
This table compares Norwood Financial and Bank of the James Financial Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Bank of the James Financial Group||19.19%||11.47%||0.83%|
Institutional and Insider Ownership
16.9% of Norwood Financial shares are owned by institutional investors. Comparatively, 29.0% of Bank of the James Financial Group shares are owned by institutional investors. 9.7% of Norwood Financial shares are owned by company insiders. Comparatively, 13.2% of Bank of the James Financial Group shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Norwood Financial beats Bank of the James Financial Group on 9 of the 14 factors compared between the two stocks.
Norwood Financial Company Profile (Get Rating)
Norwood Financial Corp. operates as the bank holding company for Wayne Bank that provides various banking products and services. The company accepts a range of deposit products, including interest-bearing and non-interest bearing transaction accounts, and statement savings and money market accounts, as well as certificate of deposits. It also provides various loans, such as commercial loans comprising lines of credit, revolving credit, term loans, mortgages, secured lending products, and letter of credit facilities; municipal finance lending; construction loans for commercial construction projects and single-family residences; land loans; consumer loans; mortgage lending to finance principal residences and second home dwellings; and indirect dealer financing of new and used automobiles, boats, and recreational vehicles. In addition, the company offers investment securities services; trust and investment products; and cash management, direct deposit, remote deposit capture, mobile deposit capture, mobile payment, automated clearing house activity, real estate settlement, and Internet and mobile banking services. Further, it engages in the annuity and mutual fund sale, and discount brokerage activities, as well as insurance agency business. The company serves consumers, businesses, nonprofit organizations, and municipalities. It operates fourteen offices in Northeastern Pennsylvania; and sixteen offices in Delaware, Sullivan, Ontario, Otsego, and Yates Counties, New York, as well as thirty-one automated teller machines. Norwood Financial Corp. was founded in 1870 and is headquartered in Honesdale, Pennsylvania.
Bank of the James Financial Group Company Profile (Get Rating)
Bank of the James Financial Group, Inc. operates as the bank holding company for Bank of the James that provides general retail and commercial banking services to individuals, businesses, associations and organizations, and governmental authorities in Virginia, the Unites States. It offers checking, savings, individual retirement, and health care saving accounts, as well as other time deposits, including money market accounts and certificates of deposit. The company also offers loans to small- and medium-sized businesses for the purchases of equipment, facilities upgrades, inventory acquisition, and various working capital purposes; commercial and residential construction and development loans; commercial real estate mortgage loans; residential mortgage loans; and secured and unsecured consumer loans, such as lines of credit and overdraft lines of credit, as well as personal, automobile, installment, demand, and home equity loans for personal, family, or household purposes. In addition, it provides other banking services, including safe deposit boxes, traveler's checks, direct deposit of payroll and social security checks, automatic drafts for various accounts, treasury management, and credit card merchant services. Further, the company offers securities brokerage and investment services; and telephone and internet banking services comprising online bill pay, as well as acts as an agent for insurance and annuity products. It operates through a network of 16 full-service offices, 2 limited-service offices, and 1 residential mortgage loan production office. The company was founded in 1998 and is headquartered in Lynchburg, Virginia.
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