Financial Comparison: Suffolk Bancorp (SCNB) vs. National Penn Bancshares (NPBC)

Suffolk Bancorp (NYSE: SCNB) and National Penn Bancshares (NASDAQ:NPBC) are both commercial banks companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Dividends

Suffolk Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 1.0%. National Penn Bancshares pays an annual dividend of $0.44 per share. Suffolk Bancorp pays out 24.1% of its earnings in the form of a dividend. National Penn Bancshares pays out 56.4% 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. Suffolk Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

58.8% of Suffolk Bancorp shares are held by institutional investors. 4.6% of Suffolk Bancorp shares are held 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.

Profitability

This table compares Suffolk Bancorp and National Penn Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Suffolk Bancorp 18.59% 6.97% 0.70%
National Penn Bancshares 32.36% 9.98% 1.21%

Analyst Ratings

This is a summary of recent recommendations for Suffolk Bancorp and National Penn Bancshares, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Suffolk Bancorp 0 1 0 0 2.00
National Penn Bancshares 0 0 0 0 N/A

Suffolk Bancorp currently has a consensus price target of $43.00, suggesting a potential upside of 6.41%.

Valuation and Earnings

This table compares Suffolk Bancorp and National Penn Bancshares’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Suffolk Bancorp N/A N/A N/A $1.66 24.34
National Penn Bancshares N/A N/A N/A $0.78 N/A

National Penn Bancshares is trading at a lower price-to-earnings ratio than Suffolk Bancorp, indicating that it is currently the more affordable of the two stocks.

Summary

Suffolk Bancorp beats National Penn Bancshares on 6 of the 9 factors compared between the two stocks.

Suffolk Bancorp Company Profile

Suffolk Bancorp is the bank holding company for Suffolk County National Bank of Riverhead (the Bank). The Bank is a community bank, which offers commercial and retail banking services to its customers. The Bank makes commercial real estate floating and fixed rate loans, multifamily and mixed use commercial loans primarily in the boroughs of New York City, commercial and industrial loans to manufacturers, wholesalers, distributors, developers/contractors and retailers and agricultural loans. The Bank finances its activities through a combination of deposits, including demand, saving, negotiable order of withdrawal and money market deposits, as well as time deposits, and short-term borrowings, which could include federal funds with correspondent banks, securities sold under agreements to repurchase and Federal Home Loan Bank (FHLB) borrowings.

National Penn Bancshares Company Profile

National Penn Bancshares, Inc. is a bank holding company. The Company provides financial services, principally through National Penn Bank, its national bank subsidiary. The Company’s financial services affiliates consist of National Penn Wealth Management, N.A., including its National Penn Investors Trust Company (NPITC) division; National Penn Capital Advisors, Inc.; Institutional Advisors, LLC, and National Penn Insurance Services Group, Inc., including its Higgins Insurance and Caruso Benefits divisions. It operates through the Community Banking segment. Through the Community Banking segment, it offers commercial banking, consumer banking and other services which include specialized investment and insurance businesses. It serves communities throughout a 14-county market area in Pennsylvania: Berks, Bucks, Carbon, Centre, Chester, Delaware, Lancaster, Lehigh, Luzerne, Monroe, Montgomery, Northampton, Philadelphia and Schuylkill. It also serves the Cecil County, Maryland area.

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