Contrasting Bankwell Financial Group (NASDAQ:BWFG) & Rhinebeck Bancorp (NASDAQ:RBKB)

Bankwell Financial Group (NASDAQ:BWFG) and Rhinebeck Bancorp (NASDAQ:RBKB) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, institutional ownership, dividends, risk, analyst recommendations, earnings and valuation.

Volatility and Risk

Bankwell Financial Group has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500. Comparatively, Rhinebeck Bancorp has a beta of 0.19, suggesting that its share price is 81% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Bankwell Financial Group	14.10%	10.18%	0.88%
Rhinebeck Bancorp	7.20%	6.47%	0.65%

Earnings and Valuation

This table compares Bankwell Financial Group and Rhinebeck Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bankwell Financial Group	$195.71 million	1.89	$9.77 million	$3.61	13.02
Rhinebeck Bancorp	$54.24 million	2.44	-$8.62 million	$0.46	25.83

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

Analyst Recommendations

This is a summary of current ratings and price targets for Bankwell Financial Group and Rhinebeck Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bankwell Financial Group	0	2	2	0	2.50
Rhinebeck Bancorp	0	1	0	0	2.00

Bankwell Financial Group currently has a consensus price target of $47.50, indicating a potential upside of 1.09%. Given Bankwell Financial Group’s stronger consensus rating and higher possible upside, equities analysts clearly believe Bankwell Financial Group is more favorable than Rhinebeck Bancorp.

Institutional & Insider Ownership

35.8% of Bankwell Financial Group shares are held by institutional investors. Comparatively, 23.9% of Rhinebeck Bancorp shares are held by institutional investors. 19.5% of Bankwell Financial Group shares are held by company insiders. Comparatively, 6.4% of Rhinebeck Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Bankwell Financial Group beats Rhinebeck Bancorp on 12 of the 14 factors compared between the two stocks.

About Bankwell Financial Group

Bankwell Financial Group, Inc. operates as the bank holding company for Bankwell Bank that provides various banking services for individual and commercial customers. It offers various traditional depository products, including checking, savings, money market, and certificates of deposit. The company also provides first mortgage loans secured by one-to-four family owner occupied residential properties for personal use; home equity loans and home equity lines of credit secured by owner occupied one-to-four family residential properties; loans secured by commercial real estate, multi-family dwellings, owner-occupied commercial real estate, and investor-owned one-to-four family dwellings; commercial construction loans for commercial development projects, including apartment buildings and condominiums, as well as office buildings, retail, and other income producing properties; land loans; commercial business loans secured by assignments of corporate assets and personal guarantees of the business owners; loans to finance insurance premiums; overdraft lines of credit; and unsecured personal loans. It operates branches in New Canaan, Stamford, Fairfield, Westport, Darien, Norwalk, and Hamden, Connecticut. The company was formerly known as BNC Financial Group, Inc. and changed its name to Bankwell Financial Group, Inc. in September 2013. Bankwell Financial Group, Inc. was founded in 2002 and is headquartered in New Canaan, Connecticut.

About Rhinebeck Bancorp

Rhinebeck Bancorp, Inc. operates as the bank holding company for Rhinebeck Bank that provides banking and financial products and services to consumer and commercial customers in the Hudson Valley region of New York. The company offers deposits, including non-interest-bearing demand, interest bearing demand, money market, commercial and personal checking, individual retirement, and saving accounts, as well as certificates of deposit. It also provides direct and indirect automobile loans; non-residential commercial real estate loans; commercial business loans, such as term loans, revolving lines of credit, and lines of credit; residential mortgage and construction, one- to four-family residential real estate, multi-family real estate, commercial construction, and land development loans; and other consumer loans consist of home equity loans and lines of credit. In addition, the company offers retail brokerage and advisory services; life insurance services; and invests in mutual funds, annuities, and other assets. Rhinebeck Bancorp, Inc. was founded in 1860 and is headquartered in Poughkeepsie, New York. Rhinebeck Bancorp, Inc. is a subsidiary of Rhinebeck Bancorp, MHC.