Head-To-Head Analysis: Finward Bancorp (NASDAQ:FNWD) & Chicago Atlantic Real Estate Finance (NASDAQ:REFI)

Finward Bancorp (NASDAQ:FNWD) and Chicago Atlantic Real Estate Finance (NASDAQ:REFI) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, risk, earnings, valuation, institutional ownership and dividends.

Dividends

Finward Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 1.5%. Chicago Atlantic Real Estate Finance pays an annual dividend of $1.88 per share and has a dividend yield of 14.2%. Finward Bancorp pays out 38.7% of its earnings in the form of a dividend. Chicago Atlantic Real Estate Finance pays out 102.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chicago Atlantic Real Estate Finance has raised its dividend for 1 consecutive years. Chicago Atlantic Real Estate Finance is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Finward Bancorp and Chicago Atlantic Real Estate Finance”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Finward Bancorp	$111.82 million	1.25	$12.13 million	$1.24	26.10
Chicago Atlantic Real Estate Finance	$54.95 million	5.07	$37.04 million	$1.83	7.22

Chicago Atlantic Real Estate Finance has lower revenue, but higher earnings than Finward Bancorp. Chicago Atlantic Real Estate Finance is trading at a lower price-to-earnings ratio than Finward Bancorp, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Finward Bancorp has a beta of 0.31, indicating that its stock price is 69% less volatile than the S&P 500. Comparatively, Chicago Atlantic Real Estate Finance has a beta of 0.21, indicating that its stock price is 79% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for Finward Bancorp and Chicago Atlantic Real Estate Finance, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Finward Bancorp	0	2	1	0	2.33
Chicago Atlantic Real Estate Finance	0	2	2	0	2.50

Finward Bancorp currently has a consensus price target of $34.00, indicating a potential upside of 5.07%. Chicago Atlantic Real Estate Finance has a consensus price target of $20.00, indicating a potential upside of 51.29%. Given Chicago Atlantic Real Estate Finance’s stronger consensus rating and higher possible upside, analysts clearly believe Chicago Atlantic Real Estate Finance is more favorable than Finward Bancorp.

Profitability

This table compares Finward Bancorp and Chicago Atlantic Real Estate Finance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Finward Bancorp	5.23%	3.45%	0.26%
Chicago Atlantic Real Estate Finance	67.95%	12.32%	9.03%

Institutional & Insider Ownership

26.6% of Finward Bancorp shares are held by institutional investors. Comparatively, 25.5% of Chicago Atlantic Real Estate Finance shares are held by institutional investors. 5.2% of Finward Bancorp shares are held by company insiders. Comparatively, 8.3% of Chicago Atlantic Real Estate Finance shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Chicago Atlantic Real Estate Finance beats Finward Bancorp on 12 of the 17 factors compared between the two stocks.

About Finward Bancorp

Finward Bancorp operates as the holding company for Peoples Bank that provides various banking products and services. The company’s deposit products include non-interest- and interest-bearing demand accounts, savings accounts, money market deposit accounts, certificate accounts, and retirement savings plans. Its loan products portfolio comprises residential mortgage loans that enable borrowers to purchase existing homes, refinance existing homes, or construct new homes; construction loans primarily to individuals and contractors; commercial real estate loans; consumer loans to individuals for personal, household, or family purposes; home equity line of credit; home improvement loans and equity loans; commercial business loans; government loans; and loans to municipalities. The company also offers estate and retirement planning, custodial services, guardianships, IRA accounts, and investment agency accounts, as well as serves as the personal representative of estates, and acts as trustee for revocable and irrevocable trusts. In addition, it provides insurance and annuity investments to wealth management customers; holds real estate properties; and operates as a real estate investment trust. The company was formerly known as NorthWest Indiana Bancorp and changed its name to Finward Bancorp in May 2021. Finward Bancorp was founded in 1916 and is headquartered in Munster, Indiana.

About Chicago Atlantic Real Estate Finance

Chicago Atlantic Real Estate Finance, Inc. operates as a commercial real estate finance company in the United States. The company engages in originating, structuring, and investing in first mortgage loans and alternative structured financings secured by commercial real estate properties. Its portfolio primarily includes offers senior loans to state-licensed operators in the cannabis industry. The company has elected to be taxed as a real estate investment trust (REIT) and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Chicago Atlantic Real Estate Finance, Inc. was incorporated in 2021 and is headquartered in Chicago, Illinois.