Head-To-Head Analysis: Burke & Herbert Financial Services (NASDAQ:BHRB) and Applied Digital (NASDAQ:APLD)

Applied Digital (NASDAQ:APLD) and Burke & Herbert Financial Services (NASDAQ:BHRB) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, earnings, risk and analyst recommendations.

Volatility and Risk

Applied Digital has a beta of 7.25, meaning that its share price is 625% more volatile than the S&P 500. Comparatively, Burke & Herbert Financial Services has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500.

Profitability

This table compares Applied Digital and Burke & Herbert Financial Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Applied Digital	-43.49%	-13.53%	-4.16%
Burke & Herbert Financial Services	23.89%	15.11%	1.48%

Analyst Ratings

This is a summary of recent recommendations for Applied Digital and Burke & Herbert Financial Services, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Applied Digital	1	0	12	3	3.06
Burke & Herbert Financial Services	0	2	2	1	2.80

Applied Digital presently has a consensus price target of $34.73, indicating a potential downside of 5.12%. Burke & Herbert Financial Services has a consensus price target of $71.50, indicating a potential upside of 3.23%. Given Burke & Herbert Financial Services’ higher possible upside, analysts plainly believe Burke & Herbert Financial Services is more favorable than Applied Digital.

Valuation & Earnings

This table compares Applied Digital and Burke & Herbert Financial Services”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Applied Digital	$263.99 million	38.76	-$231.07 million	($0.54)	-67.78
Burke & Herbert Financial Services	$337.28 million	3.09	$117.32 million	$7.72	8.97

Burke & Herbert Financial Services has higher revenue and earnings than Applied Digital. Applied Digital is trading at a lower price-to-earnings ratio than Burke & Herbert Financial Services, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

65.7% of Applied Digital shares are owned by institutional investors. 9.5% of Applied Digital shares are owned by company insiders. Comparatively, 10.9% of Burke & Herbert Financial Services shares are owned by company 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.

Summary

Burke & Herbert Financial Services beats Applied Digital on 9 of the 15 factors compared between the two stocks.

About Applied Digital

Applied Digital Corporation designs, develops, and operates datacenters in North America. Its datacenters provide digital infrastructure solutions to the high-performance computing industry. The company also provides artificial intelligence cloud services, high performance computing datacenter hosting, and crypto datacenter hosting services. The company was formerly known as Applied Blockchain, Inc. and changed its name to Applied Digital Corporation in November 2022. Applied Digital Corporation is based in Dallas, Texas.

About Burke & Herbert Financial Services

Burke Herbert Financial Services Corp. is a bank holding company, which engages in the provision of banking products and financial services to small to medium-sized businesses, their owners and employees, professional corporations, non-profits, and individuals. It operates through the following loan portfolio segments: Commercial Real Estate, Owner-Occupied Commercial Real Estate, Acquisition, Construction, and Development, Commercial and Industrial, Single Family Residential (1-4 Units), and Consumer Non-Real Estate and Other. The Commercial Real Estate segment includes leasing of the real estate collateral or income generated from the sale of the collateral. The Owner-Occupied Commercial Real Estate segment focuses on the operations of the business that occupies the property and the value of the collateral. The Acquisition, Construction, and Development segment offers creditworthiness of the borrower, project completion within budget, sale after completion, and the value of the collateral. The Commercial and Industrial segment is involved in the operations of the business and the value of the collateral. The Single Family Residential (1-4 Units) segment provides loans for investment purpose carry risk associated with the continued creditworthiness of the borrower, the value of the collateral, and either the net operating income generated from the lease of the real estate collateral or income generated from the sale of the collateral. The Consumer Non-Real Estate and Other segment covers loans carry risk associated with the creditworthiness of the borrower and the value of the collateral. The company was founded on September 14, 2022 and is headquartered in Alexandria, VA.