Reviewing Equitable Financial (OTCMKTS:EQFN) and First Business Financial Services (NASDAQ:FBIZ)

Equitable Financial (OTCMKTS:EQFN) and First Business Financial Services (NASDAQ:FBIZ) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, analyst recommendations, profitability, institutional ownership, dividends and valuation.

Risk & Volatility

Equitable Financial has a beta of 0.1, meaning that its share price is 90% less volatile than the S&P 500. Comparatively, First Business Financial Services has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500.

Profitability

This table compares Equitable Financial and First Business Financial Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Equitable Financial	9.82%	10.12%	0.97%
First Business Financial Services	17.59%	14.22%	1.17%

Analyst Ratings

This is a breakdown of recent ratings and price targets for Equitable Financial and First Business Financial Services, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Equitable Financial	0	0	0	0	0.00
First Business Financial Services	0	0	3	0	3.00

First Business Financial Services has a consensus target price of $59.67, indicating a potential upside of 16.04%. Given First Business Financial Services’ stronger consensus rating and higher probable upside, analysts plainly believe First Business Financial Services is more favorable than Equitable Financial.

Earnings & Valuation

This table compares Equitable Financial and First Business Financial Services”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Equitable Financial	$31.33 million	1.18	$2.71 million	N/A	N/A
First Business Financial Services	$262.38 million	1.63	$44.24 million	$5.62	9.15

First Business Financial Services has higher revenue and earnings than Equitable Financial.

Institutional and Insider Ownership

7.2% of Equitable Financial shares are held by institutional investors. Comparatively, 60.1% of First Business Financial Services shares are held by institutional investors. 11.3% of Equitable Financial shares are held by company insiders. Comparatively, 5.1% of First Business Financial Services 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.

Summary

First Business Financial Services beats Equitable Financial on 11 of the 13 factors compared between the two stocks.

About Equitable Financial

Equitable Financial Corp. operates as the holding company for Equitable Bank that provides various banking products and services in Nebraska, the United States. The company offers checking and savings accounts; recorder checks; online and mobile banking; remote deposit capture; voice banking; credit card processing; debit and gift cards; and safe deposit boxes. It also provides home, home equity, auto, personal, real estate and construction, operating lines of credit, small business administration, and agricultural loans, as well as equipment financing. In addition, the company offers foreign currency and exchanges; financial planning; wealth management; investment advisory; and retirement services. It operates through branches located in Grand Island, North Platte, and Omaha. The company was founded in 1882 and is headquartered in Grand Island, Nebraska.

About First Business Financial Services

First Business Financial Services, Inc. operates as the bank holding company for First Business Bank that provides commercial banking products and services for small and medium-sized businesses, business owners, executives, professionals, and high net worth individuals in Wisconsin, Kansas, and Missouri. The company offers real estate lending, commercial and industrial lending, asset-based lending, accounts receivable financing, equipment financing loans and leases, floorplan financing, vendor financing, small business administration lending and servicing, treasury management solutions, and company retirement services. It also provides private wealth management for individuals, including creating and executing asset allocation strategies, trust and estate administration, financial planning, investment management, and access to brokerage and custody-only services. In addition, the company offers bank consulting consisting of investment portfolio administrative and asset liability management services, and commercial deposit accounts. The company was founded in 1909 and is headquartered in Madison, Wisconsin.