Porter Bancorp (NASDAQ: PBIB) and Meta Financial Group (NASDAQ:CASH) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their profitabiliy, earnings, dividends, risk, analyst recommendations, valuation and institutional ownership.

Profitability

This table compares Porter Bancorp and Meta Financial Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Porter Bancorp -4.59% -5.38% -0.20%
Meta Financial Group 18.74% 17.23% 1.58%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Porter Bancorp and Meta Financial Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Porter Bancorp 0 0 0 0 N/A
Meta Financial Group 0 1 1 0 2.50

Meta Financial Group has a consensus price target of $108.00, suggesting a potential upside of 44.48%. Given Meta Financial Group’s higher probable upside, analysts plainly believe Meta Financial Group is more favorable than Porter Bancorp.

Earnings & Valuation

This table compares Porter Bancorp and Meta Financial Group’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Porter Bancorp $35.80 million 2.00 -$2.01 million ($0.33) -35.64
Meta Financial Group $238.92 million 2.92 $49.55 million $5.30 14.10

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

Volatility & Risk

Porter Bancorp has a beta of 1.72, indicating that its share price is 72% more volatile than the S&P 500. Comparatively, Meta Financial Group has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500.

Insider & Institutional Ownership

18.4% of Porter Bancorp shares are owned by institutional investors. Comparatively, 74.1% of Meta Financial Group shares are owned by institutional investors. 28.7% of Porter Bancorp shares are owned by insiders. Comparatively, 6.1% of Meta Financial Group shares are owned by 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.

Dividends

Meta Financial Group pays an annual dividend of $0.52 per share and has a dividend yield of 0.7%. Porter Bancorp does not pay a dividend. Meta Financial Group pays out 9.8% of its earnings in the form of a dividend.

Summary

Meta Financial Group beats Porter Bancorp on 11 of the 14 factors compared between the two stocks.

About Porter Bancorp

Porter Bancorp, Inc. is a bank holding company. The Company operates through its subsidiary, PBI Bank (the Bank). The Bank is a community bank with a range of commercial and personal banking products. It offers retail and commercial deposit products. It offers drive-in banking facilities, automatic teller machines, night depository, personalized checks, credit cards, debit cards, Internet banking, mobile banking, treasury management services, remote deposit services, electronic funds transfers through automated clearing house services, domestic and foreign wire transfers, cash management, vault services, and loan and deposit sweep accounts. It operates banking offices in approximately 12 counties in Kentucky. Its markets include metropolitan Louisville in Jefferson County and the surrounding counties of Henry and Bullitt. It serves south central Kentucky and southern Kentucky from banking offices in Butler, Green, Hart, Edmonson, Barren, Warren, Ohio and Daviess Counties.

About Meta Financial Group

Meta Financial Group, Inc. is a unitary savings and loan holding company. The Company operates through its banking subsidiary, MetaBank (the Bank). Its segments include Payments, Banking, and Corporate Services/Other. MetaBank is both a community-oriented financial institution offering a range of financial services to meet the needs of the communities it serves and a payments company providing services on a nationwide basis. It operates in both the banking and payments industries through MetaBank, its retail banking operation; Meta Payment Systems (MPS), its electronic payments division; AFS/IBEX Financial Services Inc. (AFS/IBEX), its insurance premium financing division, and Refund Advantage, EPS Financial, LLC (EPS) Financial and Specialty Consumer Services, its tax-related financial solutions divisions.

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