Comparing Mercantile Bank (NASDAQ:MBWM) & Chester Bancorp (OTCMKTS:CNBA)

Mercantile Bank (NASDAQ:MBWM) and Chester Bancorp (OTCMKTS:CNBA) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, institutional ownership, profitability, dividends and earnings.

Earnings & Valuation

This table compares Mercantile Bank and Chester Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mercantile Bank	$361.89 million	2.01	$79.59 million	$5.04	8.90
Chester Bancorp	N/A	N/A	N/A	N/A	N/A

Mercantile Bank has higher revenue and earnings than Chester Bancorp.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Mercantile Bank and Chester Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mercantile Bank	0	2	3	0	2.60
Chester Bancorp	0	0	0	0	0.00

Mercantile Bank presently has a consensus price target of $55.25, suggesting a potential upside of 23.22%. Given Mercantile Bank’s stronger consensus rating and higher possible upside, research analysts plainly believe Mercantile Bank is more favorable than Chester Bancorp.

Dividends

Mercantile Bank pays an annual dividend of $1.52 per share and has a dividend yield of 3.4%. Chester Bancorp pays an annual dividend of $0.68 per share and has a dividend yield of 17.0%. Mercantile Bank pays out 30.2% of its earnings in the form of a dividend. Mercantile Bank has increased its dividend for 14 consecutive years.

Insider & Institutional Ownership

58.6% of Mercantile Bank shares are held by institutional investors. 3.2% of Mercantile Bank shares are held by insiders. Comparatively, 38.8% of Chester Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk & Volatility

Mercantile Bank has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Chester Bancorp has a beta of 0.36, indicating that its stock price is 64% less volatile than the S&P 500.

Profitability

This table compares Mercantile Bank and Chester Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mercantile Bank	22.11%	13.52%	1.34%
Chester Bancorp	N/A	N/A	N/A

Summary

Mercantile Bank beats Chester Bancorp on 10 of the 13 factors compared between the two stocks.

About Mercantile Bank

Mercantile Bank Corporation operates as the bank holding company for Mercantile Bank of Michigan that provides commercial and retail banking services to small- to medium-sized businesses and individuals in the United States. It accepts various deposit products, including checking, savings, and term certificate accounts; time deposits; and certificates of deposit. The company also provides commercial and industrial loans; vacant land, land development, and residential construction loans; owner and non-owner occupied real estate loans; multi-family and residential rental property loans; single-family residential real estate loans; home equity line of credit programs; and consumer loans, such as new and used automobile and boat loans, and credit cards, as well as overdraft protection services; and residential mortgage and instalment loans. In addition, it offers courier services and safe deposit facilities; and insurance products, such as private passenger automobile, homeowners, personal inland marine, boat owners, recreational vehicle, dwelling fire, umbrella policies, small business, and life insurance products. The company was incorporated in 1997 and is headquartered in Grand Rapids, Michigan.

About Chester Bancorp

Chester Bancorp, Inc. operates as the holding company for Chester National Bank that provides various banking products and services to individuals and businesses in Chester, Illinois. It offers checking accounts, such as regular checking, student checking, golden checking, and club checking accounts; savings accounts, including statement savings, Christmas club, and money market accounts; and certificate of deposits and individual retirement accounts. The company also provides loans comprising mortgage, construction, lot, home equity, consumer, and business loans; and reorder check services. It operates two full service offices in Sparta, Illinois; and Perryville, Missouri. Chester Bancorp, Inc. was founded in 1996 and is based in Chester, Illinois.