Eagle Financial Services (OTCMKTS:EFSI) and Isabella Bank (OTCMKTS:ISBA) Head to Head Contrast

Eagle Financial Services (OTCMKTS:EFSI) and Isabella Bank (OTCMKTS:ISBA) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, analyst recommendations, profitability, institutional ownership, risk, dividends and earnings.

Valuation and Earnings

This table compares Eagle Financial Services and Isabella Bank”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eagle Financial Services	$59.17 million	3.58	$15.34 million	$2.16	18.23
Isabella Bank	$70.49 million	3.66	$13.89 million	$2.19	16.00

Eagle Financial Services has higher earnings, but lower revenue than Isabella Bank. Isabella Bank is trading at a lower price-to-earnings ratio than Eagle Financial Services, indicating that it is currently the more affordable of the two stocks.

Dividends

Eagle Financial Services pays an annual dividend of $1.24 per share and has a dividend yield of 3.1%. Isabella Bank pays an annual dividend of $1.12 per share and has a dividend yield of 3.2%. Eagle Financial Services pays out 57.4% of its earnings in the form of a dividend. Isabella Bank pays out 51.1% 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. Isabella Bank is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Eagle Financial Services and Isabella Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eagle Financial Services	13.59%	10.92%	0.67%
Isabella Bank	13.28%	7.34%	0.73%

Volatility & Risk

Eagle Financial Services has a beta of 0.29, suggesting that its share price is 71% less volatile than the S&P 500. Comparatively, Isabella Bank has a beta of 0.11, suggesting that its share price is 89% less volatile than the S&P 500.

Insider and Institutional Ownership

0.3% of Eagle Financial Services shares are held by institutional investors. 8.7% of Eagle Financial Services shares are held by insiders. Comparatively, 9.7% of Isabella Bank shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Eagle Financial Services and Isabella Bank, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eagle Financial Services	0	0	0	0	0.00
Isabella Bank	0	1	0	0	2.00

Isabella Bank has a consensus price target of $34.00, suggesting a potential downside of 2.97%. Given Isabella Bank’s stronger consensus rating and higher probable upside, analysts plainly believe Isabella Bank is more favorable than Eagle Financial Services.

Summary

Isabella Bank beats Eagle Financial Services on 10 of the 15 factors compared between the two stocks.

About Eagle Financial Services

Eagle Financial Services, Inc. operates as the bank holding company for Bank of Clarke that provides various retail and commercial banking products and services in the Shenandoah Valley, Northern Virginia and Frederick, Maryland. It operates through three segments: Community Banking, Marine Lending, and Wealth Management. The company's deposit products include checking, NOW, money market, and regular savings accounts; and demand and time deposits. Its loan portfolio comprises one-to-four-family residential real estate, commercial real estate, construction and land development, and commercial and industrial loans, as well as secured and unsecured consumer loans, which include personal installment loans, personal lines of credit, automobile loans, and credit card loans. The company also offers fiduciary services; advisory services and investment products, including individual retirement accounts, mutual funds, tax-deferred annuities, 529 college savings plans, life insurance, long term care insurance, brokerage certificates of deposit, and other brokerage services; non-deposit investment products; and title insurance products. In addition, it provides ATM and debit cards; online bill payment services; wealth management services; and telephone, internet, and mobile banking services, as well as other commercial deposit account services, such as ACH origination and remote deposit capture services. The company operates through full-service branches, loan production offices, drive-through only facility, and ATM locations in the Virginia communities of Berryville, Winchester, Boyce, Stephens City, Purcellville, Warrenton, Leesburg, Ashburn, and Fairfax, as well as Maryland community of Frederick. Eagle Financial Services, Inc. was founded in 1881 and is headquartered in Berryville, Virginia.

About Isabella Bank

Isabella Bank Corporation operates as the bank holding company for Isabella Bank that provides various banking products and services to businesses, institutions, and individuals and their families. Its deposit products include checking accounts, savings accounts, certificates of deposit, direct deposits, and money market accounts. The company's loan portfolio comprises commercial, agricultural, and residential real estate loans, as well as consumer loans, including secured and unsecured personal loans. It also offers cash management, mobile and internet banking, electronic bill pay, automated teller machines, trust and investment, estate planning, and safe deposit box rental services; and insurance products. The company operated banking offices in Clare, Gratiot, Isabella, Mecosta, Midland, Montcalm, and Saginaw counties. Isabella Bank Corporation was founded in 1903 and is headquartered in Mount Pleasant, Michigan.