Contrasting German American Bancorp (NASDAQ:GABC) & Trustmark (NASDAQ:TRMK)

Trustmark (NASDAQ:TRMK) and German American Bancorp (NASDAQ:GABC) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, earnings, institutional ownership, dividends, valuation and risk.

Dividends

Trustmark pays an annual dividend of $1.00 per share and has a dividend yield of 2.1%. German American Bancorp pays an annual dividend of $1.24 per share and has a dividend yield of 2.5%. Trustmark pays out 25.0% of its earnings in the form of a dividend. German American Bancorp pays out 32.0% 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. Trustmark has increased its dividend for 1 consecutive years and German American Bancorp has increased 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.

Volatility and Risk

Trustmark has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500. Comparatively, German American Bancorp has a beta of 0.62, meaning that its share price is 38% less volatile than the S&P 500.

Valuation & Earnings

This table compares Trustmark and German American Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Trustmark	$1.12 billion	2.46	$224.13 million	$4.00	11.96
German American Bancorp	$487.40 million	3.83	$112.64 million	$3.88	12.81

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

Institutional & Insider Ownership

67.6% of Trustmark shares are held by institutional investors. Comparatively, 46.9% of German American Bancorp shares are held by institutional investors. 1.7% of Trustmark shares are held by insiders. Comparatively, 3.2% of German American Bancorp shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Trustmark	20.90%	10.78%	1.20%
German American Bancorp	28.78%	12.41%	1.74%

Analyst Ratings

This is a summary of recent ratings and price targets for Trustmark and German American Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Trustmark	0	4	1	1	2.50
German American Bancorp	0	2	2	2	3.00

Trustmark presently has a consensus target price of $47.38, suggesting a potential downside of 0.97%. German American Bancorp has a consensus target price of $53.33, suggesting a potential upside of 7.31%. Given German American Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe German American Bancorp is more favorable than Trustmark.

Summary

German American Bancorp beats Trustmark on 12 of the 18 factors compared between the two stocks.

About Trustmark

Trustmark Corporation is a bank holding company headquartered in Jackson, Mississippi. Through its subsidiary, Trustmark National Bank, the company provides commercial and consumer banking services, including deposit accounts, lending, cash management and digital banking. Trustmark also offers wealth management and insurance services to individuals and businesses. Its insurance operations provide services such as employee benefits and risk management. Founded in 1889, Trustmark serves customers across the southeastern United States, with a presence in Mississippi, Alabama, Florida, Tennessee and Texas.

About German American Bancorp

German American Bancorp, Inc. is a bank holding company headquartered in Jasper, Indiana. Through its subsidiary, German American Bank, it provides commercial and consumer banking services to individuals, businesses and organizations. The company offers deposit accounts, commercial and personal loans, mortgage lending, and related banking services. Its other operations include wealth management and trust services, as well as insurance products through German American Insurance. German American serves communities across southern Indiana and parts of Kentucky.