Head-To-Head Review: Old Point Financial (NASDAQ:OPOF) & Financial Institutions (NASDAQ:FISI)

Old Point Financial (NASDAQ:OPOF) and Financial Institutions (NASDAQ:FISI) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, earnings, institutional ownership, risk, analyst recommendations and valuation.

Profitability

This table compares Old Point Financial and Financial Institutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Old Point Financial	8.41%	6.69%	0.49%
Financial Institutions	13.95%	12.06%	0.83%

Earnings and Valuation

This table compares Old Point Financial and Financial Institutions”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Old Point Financial	$80.50 million	1.08	$7.73 million	$1.26	13.61
Financial Institutions	$221.40 million	1.82	$50.26 million	$2.51	10.39

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

Institutional & Insider Ownership

33.4% of Old Point Financial shares are held by institutional investors. Comparatively, 60.5% of Financial Institutions shares are held by institutional investors. 21.1% of Old Point Financial shares are held by company insiders. Comparatively, 2.7% of Financial Institutions shares are held by company 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.

Dividends

Old Point Financial pays an annual dividend of $0.56 per share and has a dividend yield of 3.3%. Financial Institutions pays an annual dividend of $1.20 per share and has a dividend yield of 4.6%. Old Point Financial pays out 44.4% of its earnings in the form of a dividend. Financial Institutions pays out 47.8% 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. Old Point Financial has increased its dividend for 3 consecutive years and Financial Institutions has increased its dividend for 13 consecutive years. Financial Institutions is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Old Point Financial and Financial Institutions, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Old Point Financial	0	0	0	0	N/A
Financial Institutions	0	2	0	0	2.00

Financial Institutions has a consensus price target of $22.00, suggesting a potential downside of 15.64%. Given Financial Institutions’ higher probable upside, analysts clearly believe Financial Institutions is more favorable than Old Point Financial.

Volatility & Risk

Old Point Financial has a beta of 0.29, suggesting that its stock price is 71% less volatile than the S&P 500. Comparatively, Financial Institutions has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.

Summary

Financial Institutions beats Old Point Financial on 12 of the 15 factors compared between the two stocks.

About Old Point Financial

Old Point Financial Corporation operates as the bank holding company for The Old Point National Bank of Phoebus that provides consumer, mortgage, and business banking services for individual and commercial customers in Virginia. It offers deposit products, including interest-bearing transaction accounts, money market deposit accounts, savings accounts, time deposits, and demand deposits. The company also provides real estate construction, commercial, and mortgage loans, such as residential 1-4 family mortgages, second mortgages, and equity lines of credit; and other loans. In addition, it offers retirement planning, estate planning, financial planning, estate and trust administration, retirement plan administration, tax, and investment management services; and insurance products, wealth management, and cash management services. Old Point Financial Corporation was founded in 1922 and is headquartered in Hampton, Virginia.

About Financial Institutions

Financial Institutions, Inc. operates as a holding company for the Five Star Bank, a chartered bank that provides banking and financial services to individuals, municipalities, and businesses in New York. The company provides checking and savings account programs, including money market accounts, certificates of deposit, sweep investments, and individual retirement and other qualified plan accounts, as well as NOW accounts. Its loan products include term loans and lines of credit; short and medium-term commercial loans for working capital, business expansion, and purchase of equipment; commercial business loans to the agricultural industry; commercial mortgage loans; one-to-four family residential mortgage loans, home improvement loans, closed-end home equity loans, and home equity lines of credit; and consumer loans, such as automobile, secured installment, and personal loans. The company offers personal insurance products, including automobile, homeowners, boat, recreational vehicle, landlord, and umbrella coverage; commercial insurance comprising property, liability, automobile, inland marine, workers compensation, bonds, crop, and umbrella insurance products; and financial services, such as life and disability insurance, medicare supplements, long-term care, annuities, mutual funds, and retirement programs. In addition, it offers customized investment advisory, wealth management, investment consulting, and retirement plan services, as well as operates a real estate investment trust that holds residential mortgages and commercial real estate loans. Financial Institutions, Inc. was founded in 1817 and is headquartered in Warsaw, New York.