Bankwell Financial Group (NASDAQ:BWFG – Get Free Report) and MidWestOne Financial Group (NASDAQ:MOFG – Get Free Report) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.
Profitability
This table compares Bankwell Financial Group and MidWestOne Financial Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Bankwell Financial Group | 20.49% | 14.58% | 1.34% |
| MidWestOne Financial Group | 16.66% | 10.22% | 0.96% |
Valuation and Earnings
This table compares Bankwell Financial Group and MidWestOne Financial Group”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Bankwell Financial Group | $207.71 million | 2.79 | $35.20 million | $5.66 | 12.85 |
| MidWestOne Financial Group | $238.84 million | 4.26 | -$60.29 million | $2.81 | 17.55 |
Bankwell Financial Group has higher earnings, but lower revenue than MidWestOne Financial Group. Bankwell Financial Group is trading at a lower price-to-earnings ratio than MidWestOne Financial Group, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Bankwell Financial Group and MidWestOne Financial Group, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Bankwell Financial Group | 0 | 1 | 1 | 2 | 3.25 |
| MidWestOne Financial Group | 0 | 1 | 0 | 0 | 2.00 |
Bankwell Financial Group currently has a consensus target price of $71.00, suggesting a potential downside of 2.40%. Given Bankwell Financial Group’s stronger consensus rating and higher probable upside, equities analysts clearly believe Bankwell Financial Group is more favorable than MidWestOne Financial Group.
Institutional and Insider Ownership
35.8% of Bankwell Financial Group shares are held by institutional investors. Comparatively, 65.4% of MidWestOne Financial Group shares are held by institutional investors. 21.0% of Bankwell Financial Group shares are held by insiders. Comparatively, 2.5% of MidWestOne Financial Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Risk & Volatility
Bankwell Financial Group has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, MidWestOne Financial Group has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500.
Dividends
Bankwell Financial Group pays an annual dividend of $0.80 per share and has a dividend yield of 1.1%. MidWestOne Financial Group pays an annual dividend of $0.97 per share and has a dividend yield of 2.0%. Bankwell Financial Group pays out 14.1% of its earnings in the form of a dividend. MidWestOne Financial Group pays out 34.5% 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.
Summary
Bankwell Financial Group beats MidWestOne Financial Group on 11 of the 17 factors compared between the two stocks.
About Bankwell Financial Group
Bankwell Financial Group, Inc. operates as the bank holding company for Bankwell Bank that provides various banking services for individual and commercial customers. It offers various traditional depository products, including checking, savings, money market, and certificates of deposit. The company also provides first mortgage loans secured by one-to-four family owner occupied residential properties for personal use; home equity loans and home equity lines of credit secured by owner occupied one-to-four family residential properties; loans secured by commercial real estate, multi-family dwellings, owner-occupied commercial real estate, and investor-owned one-to-four family dwellings; commercial construction loans for commercial development projects, including apartment buildings and condominiums, as well as office buildings, retail, and other income producing properties; land loans; commercial business loans secured by assignments of corporate assets and personal guarantees of the business owners; loans to finance insurance premiums; overdraft lines of credit; and unsecured personal loans. It operates branches in New Canaan, Stamford, Fairfield, Westport, Darien, Norwalk, and Hamden, Connecticut. The company was formerly known as BNC Financial Group, Inc. and changed its name to Bankwell Financial Group, Inc. in September 2013. Bankwell Financial Group, Inc. was founded in 2002 and is headquartered in New Canaan, Connecticut.
About MidWestOne Financial Group
MidWestOne Financial Group, Inc. operates as the bank holding company for MidWestOne Bank that provides commercial and retail banking products and services to individuals, businesses, governmental units, and institutional customers. It offers range of deposit products, including noninterest bearing and interest bearing demand deposits, savings, money market, and time deposits accounts. The company also provides commercial, real estate, agricultural, credit card, and consumer loans; and financing arrangements, such as brokered deposits, term debt, subordinated debt, and equity. In addition, it offers trust and investment services comprising administering estates, trusts, and conservatorships; property and farm management, investment advisory, retail securities brokerage, financial planning, and custodial services; and licensed brokers services. Further, the company provides online and mobile banking, debit cards, automated teller machines, and safe deposit boxes. MidWestOne Financial Group, Inc. was founded in 1934 and is headquartered in Iowa City, Iowa.
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