Analyzing Northeast Community Bancorp (NASDAQ:NECB) & Nicolet Bankshares (NYSE:NIC)

Northeast Community Bancorp (NASDAQ:NECB) and Nicolet Bankshares (NYSE:NIC) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, profitability, dividends, institutional ownership, valuation, analyst recommendations and earnings.

Profitability

This table compares Northeast Community Bancorp and Nicolet Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northeast Community Bancorp	28.09%	14.04%	2.30%
Nicolet Bankshares	25.12%	11.48%	1.52%

Valuation & Earnings

This table compares Northeast Community Bancorp and Nicolet Bankshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northeast Community Bancorp	$162.80 million	1.70	$47.07 million	$3.35	5.89
Nicolet Bankshares	$520.63 million	3.56	$124.06 million	$8.71	14.33

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

Institutional and Insider Ownership

53.3% of Northeast Community Bancorp shares are owned by institutional investors. Comparatively, 43.1% of Nicolet Bankshares shares are owned by institutional investors. 6.3% of Northeast Community Bancorp shares are owned by company insiders. Comparatively, 16.4% of Nicolet Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Northeast Community Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 4.1%. Nicolet Bankshares pays an annual dividend of $1.28 per share and has a dividend yield of 1.0%. Northeast Community Bancorp pays out 23.9% of its earnings in the form of a dividend. Nicolet Bankshares pays out 14.7% 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. Northeast Community Bancorp has raised its dividend for 2 consecutive years and Nicolet Bankshares has raised its dividend for 2 consecutive years.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Northeast Community Bancorp and Nicolet Bankshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northeast Community Bancorp	0	0	1	1	3.50
Nicolet Bankshares	0	2	2	0	2.50

Nicolet Bankshares has a consensus target price of $145.33, suggesting a potential upside of 16.41%. Given Nicolet Bankshares’ higher probable upside, analysts clearly believe Nicolet Bankshares is more favorable than Northeast Community Bancorp.

Volatility and Risk

Northeast Community Bancorp has a beta of 0.53, meaning that its share price is 47% less volatile than the S&P 500. Comparatively, Nicolet Bankshares has a beta of 0.73, meaning that its share price is 27% less volatile than the S&P 500.

Summary

Nicolet Bankshares beats Northeast Community Bancorp on 10 of the 17 factors compared between the two stocks.

About Northeast Community Bancorp

Northeast Community Bancorp, Inc. operates as the holding company for NorthEast Community Bank that provides financial services for individuals and businesses. It accepts various deposit instruments, including checking accounts, money market accounts, regular savings accounts, and non-interest bearing demand accounts, as well as certificates of deposits. The company also offers construction, commercial and industrial, multifamily and mixed-use real estate, non-residential real estate loans, and consumer loans. In addition, it invests in various types of liquid assets, including U.S. Treasury obligations, municipal securities, deposits at the Federal Home Loan Bank of New York, and certificates of deposit of federally insured institutions, as well as securities of various federal agencies, and of state and municipal governments. Further, the company offers financial planning and investment advisory services; and life insurance products and fixed-rate annuities. It operates full-service branches located in Bronx, New York, Orange, Rockland, and Sullivan Counties in New York and Essex, Middlesex, and Norfolk Counties in Massachusetts; and loan production offices located in White Plains, New York, and New City counties in New York and Danvers, Massachusetts. Northeast Community Bancorp, Inc. was founded in 1934 and is headquartered in White Plains, New York.

About Nicolet Bankshares

Nicolet Bankshares, Inc. operates as the bank holding company for Nicolet National Bank that provides banking products and services for businesses and individuals in Wisconsin and Michigan. The company accepts checking, savings, and money market accounts; various certificates of deposit; and individual retirement accounts. It also offers commercial loans, including commercial, industrial, and business loans and lines of credit; commercial real estate loans; agricultural (AG) production and AG real estate loans; commercial real estate investment real estate loans; construction and land development loans; residential real estate loans, such as residential first lien and junior lien mortgages, home equity loans, lines of credit, and residential construction loans; and consumer loans. In addition, the company provides cash management, international banking, personal brokerage, safe deposit boxes, and trust and fiduciary services, as well as wealth management and retirement plan services. Further, it offers mortgage refinancing; online services, such as commercial, retail, and trust online banking; automated bill payment, mobile banking deposits and account access, and remote deposit capture services; and other services consisting of wire transfers, debit cards, credit cards, pre-paid gift cards, direct deposits, and official bank checks, as well as facilitates crop insurance products. The company was formerly known as Green Bay Financial Corporation and changed its name to Nicolet Bankshares, Inc. in March 2002. The company was incorporated in 2000 and is headquartered in Green Bay, Wisconsin.