Prime Meridian (OTCMKTS:PMHG) versus Auburn National Bancorporation (NASDAQ:AUBN) Financial Contrast

Auburn National Bancorporation (NASDAQ:AUBN) and Prime Meridian (OTCMKTS:PMHG) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, risk, dividends, earnings, institutional ownership, analyst recommendations and valuation.

Risk & Volatility

Auburn National Bancorporation has a beta of 0.42, suggesting that its stock price is 58% less volatile than the S&P 500. Comparatively, Prime Meridian has a beta of 0.06, suggesting that its stock price is 94% less volatile than the S&P 500.

Dividends

Auburn National Bancorporation pays an annual dividend of $1.08 per share and has a dividend yield of 5.1%. Prime Meridian pays an annual dividend of $1.00 per share and has a dividend yield of 1.7%. Auburn National Bancorporation pays out 51.9% of its earnings in the form of a dividend. Prime Meridian pays out 40.3% 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.

Profitability

This table compares Auburn National Bancorporation and Prime Meridian’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Auburn National Bancorporation	16.53%	8.27%	0.72%
Prime Meridian	15.49%	9.13%	0.87%

Analyst Ratings

This is a summary of current recommendations and price targets for Auburn National Bancorporation and Prime Meridian, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Auburn National Bancorporation	0	1	0	0	2.00
Prime Meridian	0	0	0	0	0.00

Valuation & Earnings

This table compares Auburn National Bancorporation and Prime Meridian”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Auburn National Bancorporation	$43.89 million	1.67	$7.26 million	$2.08	10.10
Prime Meridian	$50.36 million	3.92	$8.49 million	$2.48	23.39

Prime Meridian has higher revenue and earnings than Auburn National Bancorporation. Auburn National Bancorporation is trading at a lower price-to-earnings ratio than Prime Meridian, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

39.5% of Auburn National Bancorporation shares are owned by institutional investors. Comparatively, 11.8% of Prime Meridian shares are owned by institutional investors. 25.1% of Auburn National Bancorporation shares are owned by company insiders. Comparatively, 25.9% of Prime Meridian shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Prime Meridian beats Auburn National Bancorporation on 9 of the 14 factors compared between the two stocks.

About Auburn National Bancorporation

Auburn National Bancorporation, Inc. operates as the bank holding company for AuburnBank that provides various banking products and services in East Alabama. The company offers checking, savings, and transaction deposit accounts, as well as certificates of deposit. It also provides commercial, financial, agricultural, real estate construction, and consumer loan products; and other financial services. In addition, the company offers automated teller services; debit cards; online banking, bill payment, and other electronic banking services; and safe deposit boxes. Auburn National Bancorporation, Inc. was founded in 1907 and is headquartered in Auburn, Alabama.

About Prime Meridian

Prime Meridian Holding Company operates as the bank holding company for Prime Meridian Bank that provides various consumer and commercial banking services to individuals and businesses. The company accepts various deposits, such as checking, money market, savings, term certificate of deposit, demand interest-bearing and noninterest-bearing, health savings, NOW, and escrow accounts, as well as retirement savings plans and time deposits. Its loan products include commercial real estate, residential real estate and home equity, small business administration, construction, equipment, and commercial loans; and consumer and other loans comprising financing of automobiles, boats, and recreational vehicles, as well as issues standby letters and business lines of credit. The company also offers debit and credit cards; mobile banking, remote and mobile deposit, Apple Pay, bank-to-bank transfer, and online banking services; and safe deposit, wire transfer, foreign exchange, direct deposits, notary, night depository, official checks, domestic collections, bank drafts, automated teller services, drive-in tellers, merchant card, and banking by mail services, as well as invests in securities. Prime Meridian Holding Company was founded in 2008 and is headquartered in Tallahassee, Florida.