Farmers & Merchants Bank of Long Beach (OTCMKTS:FMBL) and Sierra Bancorp (NASDAQ:BSRR) Financial Survey

Sierra Bancorp (NASDAQ:BSRR) and Farmers & Merchants Bank of Long Beach (OTCMKTS:FMBL) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, earnings, risk, valuation, analyst recommendations, profitability and institutional ownership.

Volatility & Risk

Sierra Bancorp has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500. Comparatively, Farmers & Merchants Bank of Long Beach has a beta of 0.3, indicating that its stock price is 70% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Sierra Bancorp and Farmers & Merchants Bank of Long Beach, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sierra Bancorp	0	2	2	0	2.50
Farmers & Merchants Bank of Long Beach	0	0	0	0	0.00

Sierra Bancorp currently has a consensus target price of $34.50, indicating a potential upside of 0.61%. Given Sierra Bancorp’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Sierra Bancorp is more favorable than Farmers & Merchants Bank of Long Beach.

Earnings and Valuation

This table compares Sierra Bancorp and Farmers & Merchants Bank of Long Beach”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sierra Bancorp	$203.87 million	2.24	$40.56 million	$2.87	11.95
Farmers & Merchants Bank of Long Beach	$459.33 million	2.13	$44.88 million	$428.48	19.02

Farmers & Merchants Bank of Long Beach has higher revenue and earnings than Sierra Bancorp. Sierra Bancorp is trading at a lower price-to-earnings ratio than Farmers & Merchants Bank of Long Beach, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Sierra Bancorp and Farmers & Merchants Bank of Long Beach’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sierra Bancorp	19.70%	11.17%	1.08%
Farmers & Merchants Bank of Long Beach	12.08%	3.84%	0.46%

Dividends

Sierra Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 2.9%. Farmers & Merchants Bank of Long Beach pays an annual dividend of $112.00 per share and has a dividend yield of 1.4%. Sierra Bancorp pays out 34.8% of its earnings in the form of a dividend. Farmers & Merchants Bank of Long Beach pays out 26.1% 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. Sierra Bancorp has increased its dividend for 2 consecutive years. Sierra Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

55.4% of Sierra Bancorp shares are owned by institutional investors. Comparatively, 7.6% of Farmers & Merchants Bank of Long Beach shares are owned by institutional investors. 11.9% of Sierra Bancorp shares are owned by insiders. Comparatively, 12.8% of Farmers & Merchants Bank of Long Beach shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Sierra Bancorp beats Farmers & Merchants Bank of Long Beach on 11 of the 17 factors compared between the two stocks.

About Sierra Bancorp

Sierra Bancorp operates as the bank holding company for Bank of the Sierra that provides retail and commercial banking services to individuals and businesses in California. It accepts various deposit products, such as checking accounts, savings accounts, money market demand accounts, time deposits, retirement accounts, and sweep accounts. The company's loan products include agricultural, commercial, consumer, real estate, construction, and mortgage loans. It also offers automated teller machines; electronic point-of-sale payment alternatives; online and automated telephone banking services; and remote deposit capture and automated payroll services for business customers. Sierra Bancorp was founded in 1977 and is headquartered in Porterville, California.

About Farmers & Merchants Bank of Long Beach

Farmers & Merchants Bank of Long Beach provides various banking products and services to individuals, professionals, and small to medium-sized businesses in Los Angeles, Orange, and Santa Barbara Counties. It offers checking, savings, Christmas club savings, health savings, market rate savings, and money market accounts; demand and time deposits; certificates of deposit; and individual retirement account. The company also provides personal, home, commercial real estate, real estate and construction, and commercial business loans, as well as lines of credit; financing for residential loans comprising single-family and multifamily loans; and credit and debit cards. In addition, it offers account management, receivables and payables, and risk management services; commercial lending services; and faith-based and healthcare banking services, as well as online and mobile banking services. Farmers & Merchants Bank of Long Beach was founded in 1907 and is headquartered in Long Beach, California.