Reviewing FinWise Bancorp (NASDAQ:FINW) & TowneBank (NASDAQ:TOWN)

FinWise Bancorp (NASDAQ:FINW) and TowneBank (NASDAQ:TOWN) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, earnings, profitability, risk and institutional ownership.

Volatility & Risk

FinWise Bancorp has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500. Comparatively, TowneBank has a beta of 0.82, suggesting that its share price is 18% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for FinWise Bancorp and TowneBank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FinWise Bancorp	0	0	4	0	3.00
TowneBank	0	1	2	0	2.67

FinWise Bancorp currently has a consensus target price of $20.88, indicating a potential upside of 47.53%. TowneBank has a consensus target price of $40.00, indicating a potential upside of 21.77%. Given FinWise Bancorp’s stronger consensus rating and higher probable upside, equities analysts plainly believe FinWise Bancorp is more favorable than TowneBank.

Earnings & Valuation

This table compares FinWise Bancorp and TowneBank”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FinWise Bancorp	$84.44 million	2.21	$12.74 million	$0.92	15.38
TowneBank	$717.45 million	3.43	$161.76 million	$2.36	13.92

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

Profitability

This table compares FinWise Bancorp and TowneBank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FinWise Bancorp	13.23%	7.67%	2.00%
TowneBank	15.77%	7.77%	0.96%

Insider and Institutional Ownership

35.4% of FinWise Bancorp shares are held by institutional investors. Comparatively, 56.0% of TowneBank shares are held by institutional investors. 21.3% of FinWise Bancorp shares are held by insiders. Comparatively, 8.1% of TowneBank shares are held 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.

Summary

TowneBank beats FinWise Bancorp on 9 of the 14 factors compared between the two stocks.

About FinWise Bancorp

FinWise Bancorp operates as the bank holding company for FinWise Bank that provides various banking products and services to individual and corporate customers in Utah. The company offers various deposit products, including interest and noninterest bearing demand accounts, health savings account demand deposits, NOW and money market accounts, and checking and savings accounts, as well as time deposits and certificates of deposits. It also provides loans, including consumer, small business administration, commercial, commercial real estate, and residential real estate loans. In addition, the company offers debit cards, remote deposit capture, online banking, mobile banking, and direct deposit services; and business accounts and cash management services, such as business checking and savings accounts, and treasury services. FinWise Bancorp was founded in 1999 and is headquartered in Murray, Utah.

About TowneBank

TowneBank provides retail and commercial banking services for individuals, commercial enterprises, and professionals. The company operates through three segments: Banking, Realty, and Insurance. It accepts various deposits, including demand deposits, savings accounts, money rate savings, certificates of deposit, and individual retirement accounts. The company also offers secured and unsecured personal loans for financing automobiles, home improvements, education, and personal investments; commercial loans for working capital, business expansion, and equipment and machinery purchases; and mortgage loans, as well as real estate acquisition, development, and construction loans. In addition, it provides other services, such as safe deposit boxes, treasury management services, direct deposit of payroll and social security checks, and automatic drafts for various accounts, as well as online, mobile, and on-call banking services. Further, the company offers documentation services to accomplish tax deferral to investors; investment and asset management services; commercial mortgage brokerage services; and other financial services, such as financial, retirement, and estate planning services, as well as assistance on various investment options comprising alternative investments, annuities, margin accounts, convertible bonds, and pension and profit-sharing plans. Additionally, it provides residential real estate, relocation, property management, vacation rentals, and title and settlement services; and originates residential mortgage loans. The company also offers life, property, casualty, and vehicle insurance services; and employee benefit programs, such as health, dental, vision, and disability insurance. It operates in Richmond, Virginia, the Greater Hampton Roads region in southeastern Virginia, northeastern North Carolina, Raleigh, Charlotte, Greensboro, and Greenville, North Carolina. TowneBank was incorporated in 1998 and is based in Portsmouth, Virginia.