Critical Analysis: Associated Banc (NYSE:ASB) vs. Equitable Financial (OTCMKTS:EQFN)

Equitable Financial (OTCMKTS:EQFN) and Associated Banc (NYSE:ASB) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, earnings, profitability, analyst recommendations, risk, institutional ownership and dividends.

Earnings & Valuation

This table compares Equitable Financial and Associated Banc”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Equitable Financial	$33.95 million	1.17	$3.44 million	$1.31	12.30
Associated Banc	$2.46 billion	1.64	$474.78 million	$2.77	8.78

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

Profitability

This table compares Equitable Financial and Associated Banc’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Equitable Financial	9.70%	6.57%	0.64%
Associated Banc	19.31%	10.25%	1.07%

Volatility & Risk

Equitable Financial has a beta of 0.08, meaning that its share price is 92% less volatile than the S&P 500. Comparatively, Associated Banc has a beta of 0.8, meaning that its share price is 20% less volatile than the S&P 500.

Insider and Institutional Ownership

7.2% of Equitable Financial shares are owned by institutional investors. Comparatively, 83.0% of Associated Banc shares are owned by institutional investors. 11.3% of Equitable Financial shares are owned by company insiders. Comparatively, 1.5% of Associated Banc shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Equitable Financial and Associated Banc, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Equitable Financial	0	0	0	0	0.00
Associated Banc	0	7	4	1	2.50

Associated Banc has a consensus price target of $29.20, suggesting a potential upside of 20.02%. Given Associated Banc’s stronger consensus rating and higher probable upside, analysts plainly believe Associated Banc is more favorable than Equitable Financial.

Summary

Associated Banc beats Equitable Financial on 13 of the 15 factors compared between the two stocks.

About Equitable Financial

Equitable Financial Corp. operates as the holding company for Equitable Bank that provides various banking products and services in Nebraska, the United States. The company offers checking and savings accounts; recorder checks; online and mobile banking; remote deposit capture; voice banking; credit card processing; debit and gift cards; and safe deposit boxes. It also provides home, home equity, auto, personal, real estate and construction, operating lines of credit, small business administration, and agricultural loans, as well as equipment financing. In addition, the company offers foreign currency and exchanges; financial planning; wealth management; investment advisory; and retirement services. It operates through branches located in Grand Island, North Platte, and Omaha. The company was founded in 1882 and is headquartered in Grand Island, Nebraska.

About Associated Banc

Associated Banc-Corp, a bank holding company, provides various banking and nonbanking products to individuals and businesses in Wisconsin, Illinois, and Minnesota. The company offers lending solutions, including commercial loans and lines of credit, commercial real estate financing, construction loans, letters of credit, leasing, asset based lending and equipment finance, loan syndications products, residential mortgages, home equity loans and lines of credit, personal and installment loans, auto finance and business loans, and business lines of credit. It also provides deposit and cash management solutions, such as commercial checking and interest-bearing deposit products, cash vault and night depository services, liquidity solutions, payables and receivables solutions, and information services; specialized financial services, such as interest rate risk management and foreign exchange solutions; fiduciary services, such as administration of pension, profit-sharing and other employee benefit plans, fiduciary and corporate agency services, and institutional asset management services; and investable funds solutions, including savings, money market deposit accounts, IRA accounts, CDs, fixed and variable annuities, full-service, discount, and online investment brokerage; investment advisory services; and trust and investment management accounts. In addition, the company offers deposit and transactional solutions, including checking, credit, debit and pre-paid cards, online banking and bill pay; and money transfer services. Associated Banc-Corp was founded in 1861 and is headquartered in Green Bay, Wisconsin.