Head to Head Review: John Marshall Bancorp (NASDAQ:JMSB) & German American Bancorp (NASDAQ:GABC)

German American Bancorp (NASDAQ:GABC) and John Marshall Bancorp (NASDAQ:JMSB) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, profitability and risk.

Insider and Institutional Ownership

46.9% of German American Bancorp shares are owned by institutional investors. Comparatively, 39.1% of John Marshall Bancorp shares are owned by institutional investors. 3.2% of German American Bancorp shares are owned by company insiders. Comparatively, 12.6% of John Marshall Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares German American Bancorp and John Marshall Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
German American Bancorp	28.25%	12.14%	1.69%
John Marshall Bancorp	20.41%	9.16%	1.04%

Dividends

German American Bancorp pays an annual dividend of $1.24 per share and has a dividend yield of 2.5%. John Marshall Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 1.7%. German American Bancorp pays out 32.7% of its earnings in the form of a dividend. John Marshall Bancorp pays out 23.1% 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. German American Bancorp has raised its dividend for 13 consecutive years. German American Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent ratings for German American Bancorp and John Marshall Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
German American Bancorp	0	2	2	1	2.80
John Marshall Bancorp	1	0	2	1	2.75

German American Bancorp presently has a consensus target price of $53.33, indicating a potential upside of 6.82%. John Marshall Bancorp has a consensus target price of $25.00, indicating a potential upside of 9.17%. Given John Marshall Bancorp’s higher possible upside, analysts plainly believe John Marshall Bancorp is more favorable than German American Bancorp.

Risk and Volatility

German American Bancorp has a beta of 0.61, meaning that its stock price is 39% less volatile than the S&P 500. Comparatively, John Marshall Bancorp has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500.

Earnings and Valuation

This table compares German American Bancorp and John Marshall Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
German American Bancorp	$487.40 million	3.85	$112.64 million	$3.79	13.17
John Marshall Bancorp	$115.33 million	2.80	$21.23 million	$1.73	13.24

German American Bancorp has higher revenue and earnings than John Marshall Bancorp. German American Bancorp is trading at a lower price-to-earnings ratio than John Marshall Bancorp, indicating that it is currently the more affordable of the two stocks.

Summary

German American Bancorp beats John Marshall Bancorp on 12 of the 16 factors compared between the two stocks.

About German American Bancorp

German American Bancorp, Inc. operates as a financial holding company for German American Bank that provides retail and commercial banking services. The company operates through three segments: Core Banking, Wealth Management Services, and Insurance Operations. The Core Banking segment accepts deposits from the general public; and originates consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, as well as sells residential mortgage loans in the secondary market. The Wealth Management segment provides trust, investment advisory, brokerage, and retirement planning services. The Insurance Operations segment offers a range of personal and corporate property and casualty insurance products. It also offers checking, saving, and individual retirement accounts; certificates of deposit; wire transfer; credit cards; home equity, mortgages, and small business; treasury management; and online and mobile banking, bill pay, digital wallet, mobile check deposit, credit score and report, money management, and estatements, as well as wealth advisory. German American Bancorp, Inc. was founded in 1910 and is based in Jasper, Indiana.

About John Marshall Bancorp

John Marshall Bancorp, Inc. is the bank holding company for John Marshall Bank. The Bank is headquartered in Reston, Virginia with eight full-service branches located in Alexandria, Arlington, Loudoun, Prince William, Reston, and Tysons, Virginia, as well as Rockville, Maryland, and Washington, D.C. The Bank is dedicated to providing exceptional value, personalized service and convenience to local businesses and professionals in the Washington, D.C. Metropolitan area. The Bank offers a comprehensive line of sophisticated banking products and services that rival those of the largest banks along with experienced staff to help achieve customers’ financial goals. Dedicated relationship managers serve as direct points-of-contact, providing subject matter expertise in a variety of niche industries including charter and private schools, government contractors, health services, nonprofits and associations, professional services, property management companies and title companies