Bank First National (NASDAQ:BFC) vs. Norwood Financial (NASDAQ:NWFL) Financial Contrast

Bank First National (NASDAQ:BFC) and Norwood Financial (NASDAQ:NWFL) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, analyst recommendations, earnings, valuation, profitability, dividends and institutional ownership.

Profitability

This table compares Bank First National and Norwood Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank First National	27.49%	12.79%	1.81%
Norwood Financial	17.75%	13.09%	1.28%

Volatility and Risk

Bank First National has a beta of 0.44, indicating that its share price is 56% less volatile than the S&P 500. Comparatively, Norwood Financial has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500.

Institutional and Insider Ownership

30.0% of Bank First National shares are held by institutional investors. Comparatively, 28.1% of Norwood Financial shares are held by institutional investors. 5.0% of Bank First National shares are held by company insiders. Comparatively, 8.1% of Norwood Financial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Bank First National and Norwood Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank First National	$243.93 million	6.67	$71.50 million	$7.19	20.17
Norwood Financial	$136.15 million	2.45	$27.75 million	$2.71	11.32

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

Analyst Recommendations

This is a breakdown of recent recommendations for Bank First National and Norwood Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank First National	1	1	2	1	2.60
Norwood Financial	0	2	1	0	2.33

Bank First National currently has a consensus price target of $153.50, suggesting a potential upside of 5.86%. Norwood Financial has a consensus price target of $33.00, suggesting a potential upside of 7.60%. Given Norwood Financial’s higher possible upside, analysts clearly believe Norwood Financial is more favorable than Bank First National.

Dividends

Bank First National pays an annual dividend of $2.00 per share and has a dividend yield of 1.4%. Norwood Financial pays an annual dividend of $1.28 per share and has a dividend yield of 4.2%. Bank First National pays out 27.8% of its earnings in the form of a dividend. Norwood Financial pays out 47.2% 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. Bank First National has increased its dividend for 10 consecutive years and Norwood Financial has increased its dividend for 7 consecutive years.

Summary

Bank First National beats Norwood Financial on 13 of the 18 factors compared between the two stocks.

About Bank First National

Bank First Corporation operates as a holding company for Bank First, N.A. that provides consumer and commercial financial services to businesses, professionals, consumers, associations, individuals, and governmental authorities in Wisconsin. It offers checking, savings, money market, cash management, retirement, and health savings accounts; other time deposits; certificates of deposit; and residential mortgage products. The company's loan products include real estate loans, including commercial real estate, residential mortgage, and home equity loans; commercial and industrial loans for working capital, accounts receivable, inventory financing, and other business purposes; construction and development loans; residential 1-4 family loans; and consumer loans for personal and household purposes, including secured and unsecured installment loans, and revolving lines of credit. It also provides credit cards; ATM processing; insurance; data processing and other information technology; investment and safekeeping; treasury management; and online, telephone, and mobile banking services. The company was formerly known as Bank First National Corporation and changed its name to Bank First Corporation in June 2019. Bank First Corporation was founded in 1894 and is headquartered in Manitowoc, Wisconsin.

About Norwood Financial

Norwood Financial Corp. operates as the bank holding company for Wayne Bank that provides various banking products and services. The company accepts a range of deposit products, including interest-bearing and non-interest-bearing transaction accounts, and statement savings and money market accounts, as well as certificate of deposits. It also provides commercial loans comprising lines of credit, revolving credit, term loans, mortgages, secured lending products, and letter of credit facilities; municipal finance lending; construction loans for commercial construction projects and single-family residences; land loans; construction financing; consumer loans; mortgage lending to finance principal residences and second home dwellings; and indirect dealer financing of new and used automobiles, boats, and recreational vehicles. In addition, the company offers investment securities services; personal and business credit services; trust and investment products; and cash management, direct deposit, remote deposit capture, mobile deposit capture, automated clearing house activity, real estate settlement, and Internet and mobile banking services. Further, it engages in the annuity and mutual fund sale, and discount brokerage activities, as well as insurance agency business. The company serves consumers, businesses, nonprofit organizations, and municipalities. It operates branches in Northeastern Pennsylvania; and in Delaware, Sullivan, Ontario, Otsego, and Yates Counties, New York, as well as automated teller machines. Norwood Financial Corp. was founded in 1870 and is headquartered in Honesdale, Pennsylvania.