Reviewing Investar (NASDAQ:ISTR) and Fvcbankcorp (NASDAQ:FVCB)

Investar (NASDAQ:ISTR) and Fvcbankcorp (NASDAQ:FVCB) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.

Analyst Recommendations

This is a summary of current ratings and target prices for Investar and Fvcbankcorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Investar	0	2	1	0	2.33
Fvcbankcorp	0	1	2	0	2.67

Investar presently has a consensus target price of $29.00, suggesting a potential upside of 1.72%. Fvcbankcorp has a consensus target price of $18.00, suggesting a potential upside of 16.28%. Given Fvcbankcorp’s stronger consensus rating and higher probable upside, analysts clearly believe Fvcbankcorp is more favorable than Investar.

Profitability

This table compares Investar and Fvcbankcorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Investar	14.92%	9.20%	0.86%
Fvcbankcorp	18.08%	8.84%	0.96%

Dividends

Investar pays an annual dividend of $0.44 per share and has a dividend yield of 1.5%. Fvcbankcorp pays an annual dividend of $0.24 per share and has a dividend yield of 1.6%. Investar pays out 20.6% of its earnings in the form of a dividend. Fvcbankcorp pays out 19.8% 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. Investar has increased its dividend for 10 consecutive years. Fvcbankcorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

50.2% of Investar shares are owned by institutional investors. Comparatively, 43.6% of Fvcbankcorp shares are owned by institutional investors. 8.8% of Investar shares are owned by insiders. Comparatively, 14.0% of Fvcbankcorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility and Risk

Investar has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500. Comparatively, Fvcbankcorp has a beta of 0.36, suggesting that its share price is 64% less volatile than the S&P 500.

Earnings & Valuation

This table compares Investar and Fvcbankcorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Investar	$153.48 million	2.55	$22.90 million	$2.14	13.32
Fvcbankcorp	$122.03 million	2.28	$22.06 million	$1.21	12.79

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

Summary

Investar beats Fvcbankcorp on 9 of the 17 factors compared between the two stocks.

About Investar

Investar Holding Corporation operates as the bank holding company for Investar Bank that provides a range of commercial banking products to individuals, professionals, and small to medium-sized businesses in south Louisiana, southeast Texas, and Alabama in the United States. The company offers various deposit products and services, such as savings, checking, money market, and individual retirement accounts, as well as various certificates of deposit; debit and credit cards; internet, mobile, and video banking services; and reciprocal deposit products. It also provides commercial real estate loans; commercial and industrial loans, including working capital lines of credit and equipment loans; loans for the construction of commercial projects, and single family residential and multifamily properties; one-to-four family residential real estate loans, such as second mortgage loans; and consumer loans, such as secured and unsecured installment and term loans, home equity loans and lines of credit, and auto loans, as well as loans for personal, family, and household purposes. In addition, the company offers treasury management products, including remote deposit capture, lockbox payment processing, virtual vault, positive pay, ACH origination, wire transfer, investment sweep accounts, and business internet banking services. Further, it provides various other banking services, such as cashiers' checks, direct deposit of payroll and social security checks, night depository, bank-by-mail, automated teller machines, electronic statements, interactive teller machines, online account opening, and mobile wallet payment services. Investar Holding Corporation was founded in 2006 and is headquartered in Baton Rouge, Louisiana.

About Fvcbankcorp

FVCBankcorp, Inc. operates as the bank holding company for FVCbank that provides various banking products and services in Virginia. It offers deposit products, including interest and noninterest-bearing transaction accounts, savings accounts, money market accounts, and certificates of deposit. The company also provides commercial real estate loans; commercial construction loans; commercial loans for various business purposes, such as for working capital, equipment purchases, lines of credit, and government contract financing; small business administration loans; asset-based loans and accounts receivable financing; home equity loans; and consumer loans. In addition, it offers business and consumer credit cards; merchant services; business insurance products; and online banking, remote deposit, and mobile banking services. The company serves commercial businesses, nonprofit organizations, professional service entities, and their respective owners and employees located in the greater Washington, D.C., and Baltimore metropolitan areas. It operates branch offices in Arlington, Virginia; the independent city of Manassas, Virginia; Reston, Fairfax County, Virginia; Springfield, Fairfax County in Virginia; and Montgomery County and Baltimore in Maryland, and Washington, D.C. FVCBankcorp, Inc. was founded in 2007 and is headquartered in Fairfax, Virginia.