Independent Bank (NASDAQ:INDB) vs. Bankwell Financial Group (NASDAQ:BWFG) Financial Comparison

Independent Bank (NASDAQ:INDB) and Bankwell Financial Group (NASDAQ:BWFG) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, valuation, profitability, dividends and institutional ownership.

Insider and Institutional Ownership

83.4% of Independent Bank shares are owned by institutional investors. Comparatively, 35.8% of Bankwell Financial Group shares are owned by institutional investors. 0.8% of Independent Bank shares are owned by insiders. Comparatively, 19.5% of Bankwell Financial Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Independent Bank and Bankwell Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Independent Bank	16.64%	7.19%	1.08%
Bankwell Financial Group	14.10%	10.18%	0.88%

Dividends

Independent Bank pays an annual dividend of $2.36 per share and has a dividend yield of 3.1%. Bankwell Financial Group pays an annual dividend of $0.80 per share and has a dividend yield of 1.7%. Independent Bank pays out 57.4% of its earnings in the form of a dividend. Bankwell Financial Group pays out 22.2% 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. Independent Bank has increased its dividend for 15 consecutive years. Independent Bank is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of current ratings for Independent Bank and Bankwell Financial Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Independent Bank	0	4	1	1	2.50
Bankwell Financial Group	0	2	2	0	2.50

Independent Bank currently has a consensus price target of $76.80, suggesting a potential upside of 0.46%. Bankwell Financial Group has a consensus price target of $47.50, suggesting a potential downside of 0.52%. Given Independent Bank’s higher possible upside, equities research analysts clearly believe Independent Bank is more favorable than Bankwell Financial Group.

Risk & Volatility

Independent Bank has a beta of 0.79, indicating that its stock price is 21% less volatile than the S&P 500. Comparatively, Bankwell Financial Group has a beta of 0.7, indicating that its stock price is 30% less volatile than the S&P 500.

Earnings & Valuation

This table compares Independent Bank and Bankwell Financial Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Independent Bank	$773.81 million	4.90	$192.08 million	$4.11	18.60
Bankwell Financial Group	$195.71 million	1.92	$9.77 million	$3.61	13.23

Independent Bank has higher revenue and earnings than Bankwell Financial Group. Bankwell Financial Group is trading at a lower price-to-earnings ratio than Independent Bank, indicating that it is currently the more affordable of the two stocks.

Summary

Independent Bank beats Bankwell Financial Group on 13 of the 17 factors compared between the two stocks.

About Independent Bank

Independent Bank Corp. operates as the bank holding company for Rockland Trust Company that provides commercial banking products and services to individuals and small-to-medium sized businesses in the United States. The company provides interest checking, money market, and savings accounts, as well as demand deposits and time certificates of deposit. It offers commercial real estate and construction, commercial and industrial, small business, secured and unsecured commercial, and consumer real estate loans; term loans and revolving/nonrevolving lines of credit; overdraft protection and letters of credit; and residential mortgages and home equity loans and lines. In addition, the company provides cash management services, such as ACH transaction processing, positive pay, and remote deposit services; investment management and trust services to individuals, institutions, small businesses, and charitable institutions; mobile, online, and telephone banking; estate settlement, financial planning, tax services, and other services; automated teller machines; debit and credit cards; and mutual fund and unit investment trust shares, third party model portfolios, general securities, fixed and variable annuities, and life insurance products, as well as advisory platforms. Further, it invests in low-income housing tax credit projects; holds, maintains, and disposes foreclosed properties; and operates as an investment advisor. Independent Bank Corp. was founded in 1907 and is headquartered in Rockland, Massachusetts.

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.