Financial Survey: First Capital (NASDAQ:FCAP) & Esquire Financial (NASDAQ:ESQ)

First Capital (NASDAQ:FCAP) and Esquire Financial (NASDAQ:ESQ) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, dividends, risk, institutional ownership, profitability and valuation.

Analyst Ratings

This is a summary of current recommendations for First Capital and Esquire Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Capital	0	0	2	0	3.00
Esquire Financial	0	1	0	3	3.50

Esquire Financial has a consensus price target of $122.50, indicating a potential downside of 1.47%. Given Esquire Financial’s stronger consensus rating and higher possible upside, analysts plainly believe Esquire Financial is more favorable than First Capital.

Profitability

This table compares First Capital and Esquire Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Capital	27.14%	13.67%	1.49%
Esquire Financial	26.92%	21.49%	2.66%

Institutional & Insider Ownership

11.7% of First Capital shares are held by institutional investors. Comparatively, 54.7% of Esquire Financial shares are held by institutional investors. 4.1% of First Capital shares are held by company insiders. Comparatively, 13.9% of Esquire Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

First Capital pays an annual dividend of $1.28 per share and has a dividend yield of 2.0%. Esquire Financial pays an annual dividend of $0.80 per share and has a dividend yield of 0.6%. First Capital pays out 22.4% of its earnings in the form of a dividend. Esquire Financial pays out 13.3% 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. First Capital has increased its dividend for 2 consecutive years and Esquire Financial has increased its dividend for 4 consecutive years.

Earnings & Valuation

This table compares First Capital and Esquire Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Capital	$65.31 million	3.28	$16.37 million	$5.72	11.22
Esquire Financial	$164.50 million	9.15	$50.82 million	$6.01	20.69

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

Risk and Volatility

First Capital has a beta of 0.71, indicating that its share price is 29% less volatile than the S&P 500. Comparatively, Esquire Financial has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500.

Summary

Esquire Financial beats First Capital on 14 of the 18 factors compared between the two stocks.

About First Capital

First Capital, Inc. operates as the bank holding company for First Harrison Bank that provides various banking services to individuals and business customers. The company offers various deposit instruments, including non-interest-bearing checking accounts, negotiable order of withdrawal accounts, money market accounts, regular savings accounts, certificates of deposit, and retirement savings plans. It also provides residential mortgage loans, construction loans for residential and commercial properties, and commercial real estate loans, as well as commercial business loans. In addition, the company originates mortgage loans for sale in the secondary market and sells non-deposit investment products; and offers various secured or guaranteed consumer loans comprising automobile and truck loans, home equity loans, home improvement loans, boat loans, mobile home loans, credit cards and other personal loans, and loans secured by savings deposits, as well as unsecured consumer loans. First Capital, Inc. was founded in 1891 and is based in Corydon, Indiana.

About Esquire Financial

Esquire Financial Holdings, Inc. operates as the bank holding company for Esquire Bank, National Association that provides commercial banking products and services to legal industry and small businesses, and commercial and retail customers in the United States. The company offers checking, savings, money market, and time deposits, as well as certificates of deposit. It also provides commercial loans, such as short-term financing for inventory, receivables, the purchase of supplies, or other operating needs arising during the normal course of business, as well as loans to its qualified ISO customers; commercial lines of credit; consumer loans consisting of post-settlement consumer and structured settlement loans to plaintiffs and claimants, as well as loans to individuals for debt consolidation, medical expenses, living expenses, payment of outstanding bills, or other consumer needs; and real estate loans, such as multifamily, 1-4 family residential, commercial real estate, and construction loans, as well as merchant services. In addition, it offers cash management, cash sweep, online and mobile banking, individual retirement accounts, and working capital lines of credit. Esquire Financial Holdings, Inc. was founded in 2006 and is headquartered in Jericho, New York.