Comparing Farmers National Banc (NASDAQ:FMNB) and Surrey Bancorp (OTCMKTS:SRYB)

Surrey Bancorp (OTCMKTS:SRYB) and Farmers National Banc (NASDAQ:FMNB) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, analyst recommendations, valuation, profitability, earnings and dividends.

Profitability

This table compares Surrey Bancorp and Farmers National Banc’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Surrey Bancorp	37.97%	N/A	N/A
Farmers National Banc	19.50%	14.55%	1.09%

Analyst Ratings

This is a breakdown of current ratings for Surrey Bancorp and Farmers National Banc, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Surrey Bancorp	0	0	0	0	N/A
Farmers National Banc	0	2	1	0	2.33

Farmers National Banc has a consensus price target of $15.67, indicating a potential upside of 9.63%. Given Farmers National Banc’s higher probable upside, analysts clearly believe Farmers National Banc is more favorable than Surrey Bancorp.

Earnings & Valuation

This table compares Surrey Bancorp and Farmers National Banc”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Surrey Bancorp	$16.20 million	4.23	$5.10 million	$1.52	10.99
Farmers National Banc	$170.30 million	3.15	$49.93 million	$1.45	9.86

Farmers National Banc has higher revenue and earnings than Surrey Bancorp. Farmers National Banc is trading at a lower price-to-earnings ratio than Surrey Bancorp, indicating that it is currently the more affordable of the two stocks.

Dividends

Surrey Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 2.9%. Farmers National Banc pays an annual dividend of $0.68 per share and has a dividend yield of 4.8%. Surrey Bancorp pays out 31.6% of its earnings in the form of a dividend. Farmers National Banc pays out 46.9% 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.

Institutional and Insider Ownership

3.7% of Surrey Bancorp shares are owned by institutional investors. Comparatively, 38.7% of Farmers National Banc shares are owned by institutional investors. 33.7% of Surrey Bancorp shares are owned by insiders. Comparatively, 4.0% of Farmers National Banc shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Risk & Volatility

Surrey Bancorp has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500. Comparatively, Farmers National Banc has a beta of 0.82, meaning that its stock price is 18% less volatile than the S&P 500.

Summary

Farmers National Banc beats Surrey Bancorp on 9 of the 15 factors compared between the two stocks.

About Surrey Bancorp

Surrey BanCorp engages in the provision of banking solutions through its subsidiaries, Surrey Bank & Trust . It offers checking accounts, savings, deposit services, mortgages, real estate loans, commercial credit products, business checking, and electronic banking. The company was founded on May 1, 2003 and is headquartered in Mount Airy, NC.

About Farmers National Banc

Farmers National Banc Corp. operates as a bank holding company for The Farmers National Bank of Canfield engages in the banking, trust, retirement consulting, insurance, and financial management businesses. It offers commercial and retail banking services, including checking, savings, and time deposit accounts; commercial, mortgage and installment, and home equity loans; home equity lines of credit, night depository, safe deposit box, money order, bank check, automated teller machine, Internet banking, travel card, E bond transaction, brokerage, and other services. The company also provides personal and corporate trust services in the areas of estate settlement, trust administration, employee benefit plans, and retirement services; property and casualty insurance products and services; and various insurance products through licensed representatives, as well as invests in municipal securities. The company was founded in 1887 and is headquartered in Canfield, Ohio.