Critical Review: 1st Source (NASDAQ:SRCE) and PINNACLE BK GIL/SH SH (NASDAQ:PBNK)

1st Source (NASDAQ:SRCE) and PINNACLE BK GIL/SH SH (OTCMKTS:PBNK) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, institutional ownership, risk, valuation, analyst recommendations, dividends and earnings.

Institutional & Insider Ownership

71.1% of 1st Source shares are owned by institutional investors. Comparatively, 8.1% of PINNACLE BK GIL/SH SH shares are owned by institutional investors. 20.2% of 1st Source shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent recommendations for 1st Source and PINNACLE BK GIL/SH SH, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
1st Source 0 1 0 0 2.00
PINNACLE BK GIL/SH SH 0 0 0 0 N/A

Profitability

This table compares 1st Source and PINNACLE BK GIL/SH SH’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
1st Source 22.49% 10.25% 1.29%
PINNACLE BK GIL/SH SH 17.07% 14.17% 1.58%

Volatility and Risk

1st Source has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500. Comparatively, PINNACLE BK GIL/SH SH has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500.

Valuation and Earnings

This table compares 1st Source and PINNACLE BK GIL/SH SH’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
1st Source $384.01 million 2.12 $91.96 million $3.57 8.91
PINNACLE BK GIL/SH SH $24.62 million 1.62 $5.56 million N/A N/A

1st Source has higher revenue and earnings than PINNACLE BK GIL/SH SH.

Summary

1st Source beats PINNACLE BK GIL/SH SH on 7 of the 10 factors compared between the two stocks.

1st Source Company Profile

1st Source Corporation operates as the holding company for 1st Source Bank that provides commercial and consumer banking services, trust and investment management services, and insurance to individual and business clients. Its consumer banking services include checking and savings accounts; certificates of deposit; individual retirement accounts; online and mobile banking products; consumer loans, real estate loans, and lines of credit; and financial planning, financial literacy, and other consultative services, as well as debit and credit cards. The company also offers commercial, small business, agricultural, and real estate loans for general corporate purposes, including financing for industrial and commercial properties, equipment, inventories, accounts receivables, and renewable energy and acquisition financing; and commercial leasing, treasury management, and retirement planning services. In addition, it provides a range of trust, investment, agency, and custodial services comprising administration of estates and personal trusts, as well as management of investment accounts for individuals, employee benefit plans, and charitable foundations. Further, the company offers equipment loan and lease products for new and used aircraft, automobiles and light trucks, construction equipment, and medium and heavy duty trucks; and leases construction equipment, various types of trucks, vans, automobiles, motor coaches, shuttle buses, and other equipment. Additionally, it provides corporate and personal property, casualty, and individual and group health and life insurance products and services; and investment advisory services to trust and investment clients. As of December 31, 2018, the company operated through 80 banking centers in 17 counties in Indiana and Michigan, and Sarasota County in Florida. 1st Source Corporation was founded in 1863 and is headquartered in South Bend, Indiana.

PINNACLE BK GIL/SH SH Company Profile

Pinnacle Bank provides various banking products and services for individuals and businesses in the counties of Santa Clara, San Benito, and Monterey. It offers checking, savings, money market, and individual retirement accounts, as well as certificate of deposit account registry services; and certificates of deposit. The company also provides loans and lines of credit, home equity lines of credit, home construction loans, letters of credit, commercial real estate loans, and government assisted loans. In addition, it offers online/mobile banking and cash management services; and other services consisting of automated teller machine/debit cards and safe deposit boxes, as well as debit card protection services. The company was founded in 2005 and is headquartered in Gilroy, California.

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