Isabella Bank (OTCMKTS:ISBA) and Citizens (NASDAQ:CIZN) Head-To-Head Analysis

Isabella Bank (OTCMKTS:ISBA) and Citizens (NASDAQ:CIZN) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their risk, dividends, analyst recommendations, institutional ownership, valuation, earnings and profitability.

Profitability

This table compares Isabella Bank and Citizens’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Isabella Bank	13.28%	7.34%	0.73%
Citizens	7.00%	11.28%	0.37%

Insider & Institutional Ownership

9.7% of Citizens shares are owned by institutional investors. 1.5% of Isabella Bank shares are owned by insiders. Comparatively, 8.9% of Citizens shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility & Risk

Isabella Bank has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500. Comparatively, Citizens has a beta of -0.02, meaning that its share price is 102% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for Isabella Bank and Citizens, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Isabella Bank	0	1	0	0	2.00
Citizens	0	0	1	0	3.00

Isabella Bank presently has a consensus price target of $34.00, indicating a potential upside of 4.62%. Citizens has a consensus price target of $23.00, indicating a potential upside of 243.80%. Given Citizens’ stronger consensus rating and higher possible upside, analysts clearly believe Citizens is more favorable than Isabella Bank.

Dividends

Isabella Bank pays an annual dividend of $1.12 per share and has a dividend yield of 3.4%. Citizens pays an annual dividend of $0.08 per share and has a dividend yield of 1.2%. Isabella Bank pays out 51.1% of its earnings in the form of a dividend. Citizens pays out 8.4% 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. Citizens has increased its dividend for 1 consecutive years.

Earnings and Valuation

This table compares Isabella Bank and Citizens”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Isabella Bank	$70.49 million	3.39	$13.89 million	$2.19	14.84
Citizens	$40.95 million	0.92	$5.49 million	$0.95	7.04

Isabella Bank has higher revenue and earnings than Citizens. Citizens is trading at a lower price-to-earnings ratio than Isabella Bank, indicating that it is currently the more affordable of the two stocks.

Summary

Isabella Bank beats Citizens on 9 of the 17 factors compared between the two stocks.

About Isabella Bank

Isabella Bank Corporation operates as the bank holding company for Isabella Bank that provides various banking products and services to businesses, institutions, and individuals and their families. Its deposit products include checking accounts, savings accounts, certificates of deposit, direct deposits, and money market accounts. The company's loan portfolio comprises commercial, agricultural, and residential real estate loans, as well as consumer loans, including secured and unsecured personal loans. It also offers cash management, mobile and internet banking, electronic bill pay, automated teller machines, trust and investment, estate planning, and safe deposit box rental services; and insurance products. The company operated banking offices in Clare, Gratiot, Isabella, Mecosta, Midland, Montcalm, and Saginaw counties. Isabella Bank Corporation was founded in 1903 and is headquartered in Mount Pleasant, Michigan.

About Citizens

Citizens Holding Company operates as the bank holding company for The Citizens Bank of Philadelphia that provides various commercial and personal banking products and services. It offers demand deposits; and savings and time deposit accounts. The company also provides secured and unsecured loans; mortgage loans; single and multi-family housing, farm, residential and commercial construction, and commercial real estate loans; commercial, industrial, and agricultural production loans; and consumer loans, as well as issues letters of credit. In addition, it offers personal and corporate trust services; credit life and title insurance; and online and mobile banking services. The company was founded in 1908 and is headquartered in Philadelphia, Mississippi.