Comparing Avidbank (NASDAQ:AVBH) and Horizon Bancorp (IN) (NASDAQ:HBNC)

Horizon Bancorp (IN) (NASDAQ:HBNC) and Avidbank (NASDAQ:AVBH) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, dividends, valuation, earnings, profitability, risk and institutional ownership.

Earnings & Valuation

This table compares Horizon Bancorp (IN) and Avidbank”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Horizon Bancorp (IN)	$405.46 million	2.47	-$150.48 million	($3.16)	-6.18
Avidbank	$151.76 million	2.27	-$19.55 million	($1.92)	-16.34

Avidbank has lower revenue, but higher earnings than Horizon Bancorp (IN). Avidbank is trading at a lower price-to-earnings ratio than Horizon Bancorp (IN), indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Horizon Bancorp (IN) and Avidbank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Horizon Bancorp (IN)	-36.38%	13.31%	1.40%
Avidbank	-8.69%	10.85%	1.21%

Risk and Volatility

Horizon Bancorp (IN) has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500. Comparatively, Avidbank has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500.

Institutional & Insider Ownership

64.5% of Horizon Bancorp (IN) shares are owned by institutional investors. Comparatively, 15.9% of Avidbank shares are owned by institutional investors. 1.2% of Horizon Bancorp (IN) shares are owned by insiders. Comparatively, 9.6% of Avidbank shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations for Horizon Bancorp (IN) and Avidbank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Horizon Bancorp (IN)	0	3	2	0	2.40
Avidbank	0	1	3	0	2.75

Horizon Bancorp (IN) presently has a consensus target price of $22.33, suggesting a potential upside of 14.41%. Avidbank has a consensus target price of $35.33, suggesting a potential upside of 12.63%. Given Horizon Bancorp (IN)’s higher probable upside, equities research analysts plainly believe Horizon Bancorp (IN) is more favorable than Avidbank.

Summary

Horizon Bancorp (IN) beats Avidbank on 8 of the 14 factors compared between the two stocks.

About Horizon Bancorp (IN)

Horizon Bancorp, Inc. operates as the bank holding company for Horizon Bank that engages in the provision of commercial and retail banking services. The company offers checking, saving, money market, certificate of deposits, individual retirement accounts, and time deposits, as well as non-interest- and interest-bearing demand deposits. It also provides commercial, residential real estate, mortgage, home equity, auto, personal, business, agricultural, and SBA loans, as well as credit cards. In addition, the company offers corporate and individual trust and agency, investment management, and real estate investment trust services; debit cards; treasury management; online and mobile banking; wealth, retirement, and estate and trust services; and sells various insurance products. It operates through full-service offices in northern and central Indiana and southern and central Michigan. Horizon Bancorp, Inc. was founded in 1873 and is headquartered in Michigan City, Indiana.

About Avidbank

Avidbank Holdings, Inc. operates as a bank holding company for Avidbank that provides financial products and services to small and middle-market businesses, professionals, and individuals in the Santa Clara, San Mateo, and San Francisco counties. It offers business and personal deposit products, such as checking, money market, and savings accounts; and certificates of deposit. The company also provides personal lending products include secured and unsecured lines of credit, home equity lines of credit, remodel and new home construction loans, and term loans; corporate banking comprises working capital lines of credit, equipment loans, acquisition financing, shareholder buyouts, ESOP loans, and owner-occupied real estate loans; and commercial real estate lending, such as permanent loans and bridge financing products. In addition, it offers construction lending products, including land acquisition loans, pre-development loans, construction spec SFD, owner-occupied SFD, condominiums, subdivision, unsecured business lines, real estate bridge loans, and RLOC Â? real estate secured loans. Further, the company provides various financing solutions, such as structured finance, venture lending, asset-based lending, and sponsor finance. Additionally, it offers various services, such as automated clearing house payments and collections, bill pay, wire transfer, lockbox, merchant, remote deposit capture, ATM/debit cards, credit cards, business courier, cash management, and notary services, as well as online and mobile banking. The company was formerly known as Peninsula Bank Holding Co. and changed its name to Avidbank Holdings, Inc. in August 2011. Avidbank Holdings, Inc. was founded in 2003 and is headquartered in San Jose, California.