Danske Bank (OTCMKTS:DNKEY) vs. Farmers & Merchants Bancorp (NASDAQ:FMAO) Head to Head Comparison

Farmers & Merchants Bancorp (NASDAQ:FMAO) and Danske Bank (OTCMKTS:DNKEY) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, institutional ownership, valuation, profitability and risk.

Earnings & Valuation

This table compares Farmers & Merchants Bancorp and Danske Bank”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Farmers & Merchants Bancorp	$190.68 million	2.62	$33.31 million	$3.11	11.69
Danske Bank	$8.61 billion	5.22	$3.49 billion	$2.35	11.72

Danske Bank has higher revenue and earnings than Farmers & Merchants Bancorp. Farmers & Merchants Bancorp is trading at a lower price-to-earnings ratio than Danske Bank, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Farmers & Merchants Bancorp and Danske Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Farmers & Merchants Bancorp	21.30%	11.25%	1.22%
Danske Bank	41.60%	14.40%	0.65%

Dividends

Farmers & Merchants Bancorp pays an annual dividend of $0.96 per share and has a dividend yield of 2.6%. Danske Bank pays an annual dividend of $1.58 per share and has a dividend yield of 5.7%. Farmers & Merchants Bancorp pays out 30.9% of its earnings in the form of a dividend. Danske Bank pays out 67.2% 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. Farmers & Merchants Bancorp has increased its dividend for 19 consecutive years.

Analyst Ratings

This is a summary of recent recommendations and price targets for Farmers & Merchants Bancorp and Danske Bank, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Farmers & Merchants Bancorp	0	3	0	1	2.50
Danske Bank	0	4	3	0	2.43

Farmers & Merchants Bancorp presently has a consensus price target of $33.75, indicating a potential downside of 7.18%. Given Farmers & Merchants Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe Farmers & Merchants Bancorp is more favorable than Danske Bank.

Volatility & Risk

Farmers & Merchants Bancorp has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500. Comparatively, Danske Bank has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500.

Institutional & Insider Ownership

24.0% of Farmers & Merchants Bancorp shares are held by institutional investors. 7.3% of Farmers & Merchants Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Farmers & Merchants Bancorp beats Danske Bank on 10 of the 18 factors compared between the two stocks.

About Farmers & Merchants Bancorp

Farmers & Merchants Bancorp, Inc. is a bank holding company whose primary subsidiary, The Farmers & Merchants State Bank, provides banking services to individuals, businesses and agricultural customers. Its offerings include deposit accounts, commercial and consumer lending, mortgages and other financial services. Founded in 1897, the company is headquartered in Archbold, Ohio, and serves communities in northwest Ohio and northeast Indiana through its banking locations and digital channels.

About Danske Bank

Danske Bank is a financial services group headquartered in Copenhagen, Denmark. Founded in 1871 as Den Danske Landmandsbank, it has grown into a major banking institution in the Nordic region. The bank serves personal, business, corporate and institutional customers. Its offerings include deposit accounts, lending, payment services, mortgages, investment and wealth management, and financial advice. Danske Bank’s main markets are Denmark, Finland, Norway and Sweden, and it also serves customers and businesses in other countries.