Reviewing Republic Bancorp (NASDAQ:RBCAA) and Madison County Financial (OTCMKTS:MCBK)

Madison County Financial (OTCMKTS:MCBK) and Republic Bancorp (NASDAQ:RBCAA) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, analyst recommendations, valuation and dividends.

Analyst Recommendations

This is a summary of current ratings for Madison County Financial and Republic Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Madison County Financial	0	0	0	0	0.00
Republic Bancorp	0	2	1	0	2.33

Republic Bancorp has a consensus price target of $69.00, indicating a potential downside of 6.95%. Given Republic Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Republic Bancorp is more favorable than Madison County Financial.

Risk & Volatility

Madison County Financial has a beta of 0.13, meaning that its share price is 87% less volatile than the S&P 500. Comparatively, Republic Bancorp has a beta of 0.6, meaning that its share price is 40% less volatile than the S&P 500.

Insider and Institutional Ownership

24.4% of Republic Bancorp shares are held by institutional investors. 16.9% of Madison County Financial shares are held by insiders. Comparatively, 56.4% of Republic Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

Madison County Financial pays an annual dividend of $0.36 per share and has a dividend yield of 1.3%. Republic Bancorp pays an annual dividend of $1.80 per share and has a dividend yield of 2.4%. Republic Bancorp pays out 26.8% of its earnings in the form of a dividend. Republic Bancorp has increased its dividend for 27 consecutive years. Republic Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Madison County Financial and Republic Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Madison County Financial	N/A	N/A	N/A
Republic Bancorp	25.19%	12.39%	1.87%

Valuation and Earnings

This table compares Madison County Financial and Republic Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Madison County Financial	$29.54 million	2.57	$3.82 million	N/A	N/A
Republic Bancorp	$521.34 million	2.78	$131.32 million	$6.72	11.03

Republic Bancorp has higher revenue and earnings than Madison County Financial.

Summary

Republic Bancorp beats Madison County Financial on 14 of the 15 factors compared between the two stocks.

About Madison County Financial

Madison County Financial, Inc. operates as the holding company for Madison County Bank that provides banking and financial services to individual and corporate customers in Nebraska, the United States. It offers checking, money market savings, savings, and individual retirement accounts; certificates of deposit; credit and debit cards; home loans; and consumer loans, including home equity lines of credit, second mortgage, home improvement, recreational vehicle, personal, and overdraft protection loans, as well as loans for automobiles, trucks, and vans. The company also provides agricultural real estate, machinery and equipment, livestock and crop, and operating loans; and commercial real estate, construction, investment property, and working capital loans, as well as equipment financing services. In addition, it offers online and mobile banking, and merchant services. The company was formerly known as Madison County Holding Company and changed its name to Madison County Financial, Inc. in October 2012. Madison County Financial, Inc. was founded in 1888 and is headquartered in Madison, Nebraska.

About Republic Bancorp

Republic Bancorp, Inc. operates as a bank holding company for Republic Bank & Trust Company that provides various banking products and services in the United States. It operates in six segments: Traditional Banking, Warehouse, Mortgage Banking, Tax Refund Solutions, Republic Payment Solutions, and Republic Credit Solutions. The company offers demand, money market accounts, savings, individual retirement accounts, time, brokered, and other certificates of deposit; and retail and commercial mortgage, construction and land development, consumer, aircraft, and marine loans. It also provides credit cards; title insurance and other financial products and services; and private banking, lockbox processing, remote deposit capture, business online banking, account reconciliation, automated clearing house processing, and internet and mobile banking services. In addition, it offers short-term and revolving credit facilities to mortgage bankers through mortgage warehouse lines of credit; mortgage banking; tax refund solutions, which facilitate the receipt and payment of federal and state tax refund products through third-party tax preparers and tax-preparation software providers; payments-related products and services to consumers through third party service providers; and consumer credit products. The company offers its services through full-services banking centers in Kentucky, Indiana, Florida, Ohio, and Tennessee. Republic Bancorp, Inc. was incorporated in 1974 and is headquartered in Louisville, Kentucky.