Bank Of Montreal (NYSE: BMO) and Farmers National Banc Corp. (NASDAQ:FMNB) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, earnings, dividends, institutional ownership, valuation, profitability and analyst recommendations.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Bank Of Montreal and Farmers National Banc Corp., as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bank Of Montreal 0 7 3 0 2.30
Farmers National Banc Corp. 0 2 1 0 2.33

Bank Of Montreal currently has a consensus price target of $100.25, indicating a potential upside of 36.69%. Farmers National Banc Corp. has a consensus price target of $16.00, indicating a potential upside of 23.55%. Given Bank Of Montreal’s higher probable upside, equities research analysts plainly believe Bank Of Montreal is more favorable than Farmers National Banc Corp..

Valuation and Earnings

This table compares Bank Of Montreal and Farmers National Banc Corp.’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Bank Of Montreal $16.67 billion 2.98 $4.15 billion $6.14 11.94
Farmers National Banc Corp. $90.79 million 3.86 $22.20 million $0.82 15.79

Bank Of Montreal has higher revenue and earnings than Farmers National Banc Corp.. Bank Of Montreal is trading at a lower price-to-earnings ratio than Farmers National Banc Corp., indicating that it is currently the more affordable of the two stocks.

Dividends

Bank Of Montreal pays an annual dividend of $2.78 per share and has a dividend yield of 3.8%. Farmers National Banc Corp. pays an annual dividend of $0.20 per share and has a dividend yield of 1.5%. Bank Of Montreal pays out 45.3% of its earnings in the form of a dividend. Farmers National Banc Corp. pays out 24.4% 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.

Institutional and Insider Ownership

42.6% of Bank Of Montreal shares are owned by institutional investors. Comparatively, 34.3% of Farmers National Banc Corp. shares are owned by institutional investors. 1.0% of Bank Of Montreal shares are owned by insiders. Comparatively, 7.8% of Farmers National Banc Corp. 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.

Risk and Volatility

Bank Of Montreal has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500. Comparatively, Farmers National Banc Corp. has a beta of 0.46, suggesting that its stock price is 54% less volatile than the S&P 500.

Profitability

This table compares Bank Of Montreal and Farmers National Banc Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bank Of Montreal 20.04% 14.36% 0.80%
Farmers National Banc Corp. 22.19% 10.25% 1.11%

Summary

Bank Of Montreal beats Farmers National Banc Corp. on 9 of the 16 factors compared between the two stocks.

Bank Of Montreal Company Profile

Bank of Montreal (the Bank) is a financial services provider. The Bank provides a range of personal and commercial banking, wealth management and investment banking products and services. The Bank conducts its business through three operating groups: Personal and Commercial Banking (P&C), Wealth Management and BMO Capital Markets. The P&C business includes two retail and business banking operating segments, such as Canadian Personal and Commercial Banking (Canadian P&C), and the United States Personal and Commercial Banking (U.S. P&C). The Bank’s Wealth Management business serves a range of client segments, from mainstream to ultra-high net worth and institutional, with an offering of wealth management products and services, including insurance. BMO Capital Markets is a North American-based financial services provider offering a range of products and services to corporate, institutional and government clients. The Bank has over 1,500 bank branches in Canada and the United States.

Farmers National Banc Corp. Company Profile

Farmers National Banc Corp. is a one-bank holding company. The Company’s principal business consists of owning and supervising its subsidiaries. The Company operates through tree segments: the Bank, Trust and Retirement Consulting. The Company operates principally through its subsidiaries, The Farmers National Bank of Canfield (the Bank or Farmers Bank), Farmers Trust Company (Trust or Farmers Trust), National Associates, Inc. (NAI) and Farmers National Captive, Inc. (Captive). The Bank’s subsidiaries include Farmers National Insurance, LLC (Farmers Insurance) and Farmers of Canfield Investment Co. (Farmers Investments). The banking operation offers loans, investments and deposits; the trust operations provide trust services, and the retirement consulting operations offer consulting services. The Company and its subsidiaries operate in the domestic banking, trust, retirement consulting, insurance and financial management industries.

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