Head-To-Head Survey: Old National Bancorp (NASDAQ:ONB) versus German American Bancorp (NASDAQ:GABC)

German American Bancorp (NASDAQ:GABC) and Old National Bancorp (NASDAQ:ONB) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, risk, dividends, profitability, valuation, earnings and institutional ownership.

Dividends

German American Bancorp pays an annual dividend of $1.24 per share and has a dividend yield of 2.9%. Old National Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 2.3%. German American Bancorp pays out 40.9% of its earnings in the form of a dividend. Old National Bancorp pays out 31.3% 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. German American Bancorp has increased its dividend for 13 consecutive years. German American Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares German American Bancorp and Old National Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
German American Bancorp	$487.40 million	3.31	$112.64 million	$3.03	14.21
Old National Bancorp	$3.74 billion	2.55	$669.26 million	$1.79	13.61

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

Profitability

This table compares German American Bancorp and Old National Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
German American Bancorp	23.11%	12.02%	1.55%
Old National Bancorp	17.91%	15.06%	1.22%

Insider and Institutional Ownership

46.9% of German American Bancorp shares are held by institutional investors. Comparatively, 83.7% of Old National Bancorp shares are held by institutional investors. 6.2% of German American Bancorp shares are held by company insiders. Comparatively, 0.9% of Old National Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations for German American Bancorp and Old National Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
German American Bancorp	0	2	1	0	2.33
Old National Bancorp	0	3	7	1	2.82

German American Bancorp currently has a consensus target price of $46.50, indicating a potential upside of 7.99%. Old National Bancorp has a consensus target price of $27.36, indicating a potential upside of 12.28%. Given Old National Bancorp’s stronger consensus rating and higher probable upside, analysts clearly believe Old National Bancorp is more favorable than German American Bancorp.

Risk and Volatility

German American Bancorp has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500. Comparatively, Old National Bancorp has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500.

Summary

Old National Bancorp beats German American Bancorp on 10 of the 18 factors compared between the two stocks.

About German American Bancorp

German American Bancorp, Inc. operates as a financial holding company for German American Bank that provides retail and commercial banking services. The company operates through three segments: Core Banking, Wealth Management Services, and Insurance Operations. The Core Banking segment accepts deposits from the general public; and originates consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, as well as sells residential mortgage loans in the secondary market. The Wealth Management segment provides trust, investment advisory, brokerage, and retirement planning services. The Insurance Operations segment offers a range of personal and corporate property and casualty insurance products. It also offers checking, saving, and individual retirement accounts; certificates of deposit; wire transfer; credit cards; home equity, mortgages, and small business; treasury management; and online and mobile banking, bill pay, digital wallet, mobile check deposit, credit score and report, money management, and estatements, as well as wealth advisory. German American Bancorp, Inc. was founded in 1910 and is based in Jasper, Indiana.

About Old National Bancorp

Old National Bancorp operates as the bank holding company for Old National Bank that provides various financial services to individual and commercial customers in the United States. It accepts deposit accounts, including noninterest-bearing demand, interest-bearing checking, negotiable order of withdrawal, savings and money market, and time deposits; and offers loans, such as home equity lines of credit, residential real estate loans, consumer loans, commercial loans, commercial real estate loans, agricultural loans, letters of credit, and lease financing. The company also provides debit and automated teller machine cards, telephone access, online banking, and other electronic and mobile banking services; cash management, private banking, brokerage, trust, investment advisory, and other traditional banking services; wealth management, investment, and foreign currency services; and treasury management, merchant, and capital markets services, as well as community development lending and equity investment solutions. The company was founded in 1834 and is headquartered in Evansville, Indiana.