Reviewing Solera National Bancorp (OTCMKTS:SLRK) and Farmers National Banc (NASDAQ:FMNB)

Farmers National Banc (NASDAQ:FMNB) and Solera National Bancorp (OTCMKTS:SLRK) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Valuation & Earnings

This table compares Farmers National Banc and Solera National Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Farmers National Banc	$183.61 million	2.73	$45.95 million	$1.44	9.23
Solera National Bancorp	$75.25 million	0.77	$18.07 million	$5.22	2.60

Farmers National Banc has higher revenue and earnings than Solera National Bancorp. Solera National Bancorp is trading at a lower price-to-earnings ratio than Farmers National Banc, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Farmers National Banc and Solera National Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Farmers National Banc	19.57%	13.82%	1.14%
Solera National Bancorp	28.36%	N/A	N/A

Analyst Ratings

This is a breakdown of recent recommendations for Farmers National Banc and Solera National Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Farmers National Banc	0	3	1	0	2.25
Solera National Bancorp	0	0	0	0	0.00

Farmers National Banc presently has a consensus target price of $15.50, suggesting a potential upside of 16.63%. Given Farmers National Banc’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Farmers National Banc is more favorable than Solera National Bancorp.

Institutional and Insider Ownership

38.7% of Farmers National Banc shares are owned by institutional investors. 4.0% of Farmers National Banc shares are owned by insiders. Comparatively, 17.4% of Solera National Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

Farmers National Banc has a beta of 0.85, suggesting that its share price is 15% less volatile than the S&P 500. Comparatively, Solera National Bancorp has a beta of 0.46, suggesting that its share price is 54% less volatile than the S&P 500.

Summary

Farmers National Banc beats Solera National Bancorp on 11 of the 14 factors compared between the two stocks.

About Farmers National Banc

Farmers National Banc Corp. operates as a bank holding company for The Farmers National Bank of Canfield engages in the banking, trust, retirement consulting, insurance, and financial management businesses. It offers commercial and retail banking services, including checking, savings, and time deposit accounts; commercial, mortgage and installment, and home equity loans; home equity lines of credit, night depository, safe deposit box, money order, bank check, automated teller machine, Internet banking, travel card, E bond transaction, brokerage, and other services. The company also provides personal and corporate trust services in the areas of estate settlement, trust administration, employee benefit plans, and retirement services; property and casualty insurance products and services; and various insurance products through licensed representatives, as well as invests in municipal securities. The company was founded in 1887 and is headquartered in Canfield, Ohio.

About Solera National Bancorp

Solera National Bancorp, Inc. operates as the bank holding company for Solera National Bank that provides commercial and consumer banking services in the United States. The company offers checking and savings accounts, money market accounts, time and demand deposits, and individual retirement accounts (IRA), as well as certificates of deposit; and real estate secured loans, construction loans, small business administration loans, business lines of credit, and equipment financing. It also provides online banking, account analysis, combined account analysis, commercial sweep, remote deposit, ACH origination, payroll direct deposit, merchant, business debit card, and cash management services. The company was incorporated in 2006 and is based in Lakewood, Colorado.