Fifth Third Bancorp (NASDAQ: FITB) and Orrstown Financial Services (NASDAQ:ORRF) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, earnings, dividends, institutional ownership and profitability.
This is a summary of recent ratings for Fifth Third Bancorp and Orrstown Financial Services, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Fifth Third Bancorp||2||15||3||0||2.05|
|Orrstown Financial Services||0||1||1||0||2.50|
Fifth Third Bancorp presently has a consensus target price of $30.78, indicating a potential downside of 8.73%. Orrstown Financial Services has a consensus target price of $28.00, indicating a potential upside of 12.90%. Given Orrstown Financial Services’ stronger consensus rating and higher probable upside, analysts clearly believe Orrstown Financial Services is more favorable than Fifth Third Bancorp.
Valuation & Earnings
This table compares Fifth Third Bancorp and Orrstown Financial Services’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Fifth Third Bancorp||$7.71 billion||3.00||$2.19 billion||$2.85||11.83|
|Orrstown Financial Services||$71.40 million||2.92||$8.09 million||$0.98||25.31|
Fifth Third Bancorp has higher revenue and earnings than Orrstown Financial Services. Fifth Third Bancorp is trading at a lower price-to-earnings ratio than Orrstown Financial Services, indicating that it is currently the more affordable of the two stocks.
Fifth Third Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 1.9%. Orrstown Financial Services pays an annual dividend of $0.48 per share and has a dividend yield of 1.9%. Fifth Third Bancorp pays out 22.5% of its earnings in the form of a dividend. Orrstown Financial Services pays out 49.0% 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.
Risk and Volatility
Fifth Third Bancorp has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500. Comparatively, Orrstown Financial Services has a beta of 0.41, suggesting that its stock price is 59% less volatile than the S&P 500.
This table compares Fifth Third Bancorp and Orrstown Financial Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Fifth Third Bancorp||27.08%||9.65%||1.03%|
|Orrstown Financial Services||11.33%||7.53%||0.71%|
Institutional & Insider Ownership
83.8% of Fifth Third Bancorp shares are held by institutional investors. Comparatively, 40.2% of Orrstown Financial Services shares are held by institutional investors. 0.4% of Fifth Third Bancorp shares are held by company insiders. Comparatively, 5.4% of Orrstown Financial Services shares are held 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.
Fifth Third Bancorp beats Orrstown Financial Services on 11 of the 16 factors compared between the two stocks.
Fifth Third Bancorp Company Profile
Fifth Third Bancorp is a bank holding company and a financial holding company. The Company conducts its principal lending, deposit gathering, transaction processing and service advisory activities through its banking and non-banking subsidiaries from banking centers located throughout the Midwestern and Southeastern regions of the United States. It operates through four segments: Commercial Banking, Branch Banking, Consumer Lending, and Wealth and Asset Management. It diversifies its loan and lease portfolio by offering a range of loan and lease products with various payment terms and rate structures. It offers commercial and industrial loans, commercial mortgage loans, commercial construction loans, commercial leases, residential mortgage loans, home equity, automobile loans, credit card, and other consumer loans and leases. It offers various types of deposits, such as demand deposits, interest checking deposits, savings deposits, money market deposits and transaction deposits.
Orrstown Financial Services Company Profile
Orrstown Financial Services, Inc. is the bank holding company for Orrstown Bank (the Bank). The Bank is engaged in commercial banking and trust business. The Company operates through Community Banking segment. The Bank’s activities involve accepting demand, time and savings deposits, and granting loans. The Bank grants commercial, residential, consumer and agribusiness loans in its market areas of Cumberland, Franklin, Lancaster and Perry Counties in Pennsylvania and in Washington County, Maryland. The Company’s securities available for sale include debt and equity instruments. Through its trust department, the Bank renders services as trustee, executor, administrator, managing agent, custodian, investment advisor and other fiduciary activities authorized by law under the trade name, Orrstown Financial Advisors (OFA). OFA offers retail brokerage services through a third-party broker or dealer arrangement with Cetera Advisor Networks LLC.
Receive News & Ratings for Fifth Third Bancorp Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Fifth Third Bancorp and related companies with MarketBeat.com's FREE daily email newsletter.