Comparing Esquire Financial (NASDAQ:ESQ) & Horizon Bancorp (IN) (NASDAQ:HBNC)

Horizon Bancorp (IN) (NASDAQ:HBNC) and Esquire Financial (NASDAQ:ESQ) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, earnings, valuation, risk and analyst recommendations.

Institutional & Insider Ownership

64.5% of Horizon Bancorp (IN) shares are owned by institutional investors. Comparatively, 54.7% of Esquire Financial shares are owned by institutional investors. 2.8% of Horizon Bancorp (IN) shares are owned by insiders. Comparatively, 18.0% of Esquire Financial shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Horizon Bancorp (IN) and Esquire Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Horizon Bancorp (IN)	-37.12%	11.56%	1.17%
Esquire Financial	30.90%	18.72%	2.40%

Dividends

Horizon Bancorp (IN) pays an annual dividend of $0.64 per share and has a dividend yield of 3.6%. Esquire Financial pays an annual dividend of $0.70 per share and has a dividend yield of 0.6%. Horizon Bancorp (IN) pays out -20.3% of its earnings in the form of a dividend. Esquire Financial pays out 11.9% 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. Esquire Financial has increased its dividend for 4 consecutive years. Horizon Bancorp (IN) is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Horizon Bancorp (IN) and Esquire Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Horizon Bancorp (IN)	$405.46 million	2.22	$35.43 million	($3.15)	-5.59
Esquire Financial	$164.50 million	5.64	$43.66 million	$5.88	18.40

Esquire Financial has lower revenue, but higher earnings than Horizon Bancorp (IN). Horizon Bancorp (IN) is trading at a lower price-to-earnings ratio than Esquire Financial, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for Horizon Bancorp (IN) and Esquire Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Horizon Bancorp (IN)	1	2	2	0	2.20
Esquire Financial	0	1	2	0	2.67

Horizon Bancorp (IN) presently has a consensus target price of $20.33, indicating a potential upside of 15.53%. Esquire Financial has a consensus target price of $118.00, indicating a potential upside of 9.09%. Given Horizon Bancorp (IN)’s higher probable upside, equities research analysts clearly believe Horizon Bancorp (IN) is more favorable than Esquire Financial.

Volatility & Risk

Horizon Bancorp (IN) has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500. Comparatively, Esquire Financial has a beta of 0.43, indicating that its share price is 57% less volatile than the S&P 500.

Summary

Esquire Financial beats Horizon Bancorp (IN) on 10 of the 16 factors compared between the two stocks.

About Horizon Bancorp (IN)

Horizon Bancorp, Inc. operates as the bank holding company for Horizon Bank that engages in the provision of commercial and retail banking services. The company offers checking, saving, money market, certificate of deposits, individual retirement accounts, and time deposits, as well as non-interest- and interest-bearing demand deposits. It also provides commercial, residential real estate, mortgage, home equity, auto, personal, business, agricultural, and SBA loans, as well as credit cards. In addition, the company offers corporate and individual trust and agency, investment management, and real estate investment trust services; debit cards; treasury management; online and mobile banking; wealth, retirement, and estate and trust services; and sells various insurance products. It operates through full-service offices in northern and central Indiana and southern and central Michigan. Horizon Bancorp, Inc. was founded in 1873 and is headquartered in Michigan City, Indiana.

About Esquire Financial

Esquire Financial Holdings, Inc. operates as the bank holding company for Esquire Bank, National Association that provides commercial banking products and services to legal industry and small businesses, and commercial and retail customers in the United States. The company offers checking, savings, money market, and time deposits, as well as certificates of deposit. It also provides commercial loans, such as short-term financing for inventory, receivables, the purchase of supplies, or other operating needs arising during the normal course of business, as well as loans to its qualified ISO customers; commercial lines of credit; consumer loans consisting of post-settlement consumer and structured settlement loans to plaintiffs and claimants, as well as loans to individuals for debt consolidation, medical expenses, living expenses, payment of outstanding bills, or other consumer needs; and real estate loans, such as multifamily, 1-4 family residential, commercial real estate, and construction loans, as well as merchant services. In addition, it offers cash management, cash sweep, online and mobile banking, individual retirement accounts, and working capital lines of credit. Esquire Financial Holdings, Inc. was founded in 2006 and is headquartered in Jericho, New York.