Heartland Financial USA (NASDAQ:HTLF) and Norwood Financial (NASDAQ:NWFL) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.
This table compares Heartland Financial USA and Norwood Financial’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Heartland Financial USA||20.99%||9.57%||1.10%|
55.7% of Heartland Financial USA shares are held by institutional investors. Comparatively, 17.6% of Norwood Financial shares are held by institutional investors. 6.1% of Heartland Financial USA shares are held by insiders. Comparatively, 6.6% of Norwood Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
This is a summary of recent ratings and price targets for Heartland Financial USA and Norwood Financial, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Heartland Financial USA||0||2||0||0||2.00|
Heartland Financial USA pays an annual dividend of $0.64 per share and has a dividend yield of 1.5%. Norwood Financial pays an annual dividend of $0.96 per share and has a dividend yield of 2.9%. Heartland Financial USA pays out 18.2% of its earnings in the form of a dividend. Heartland Financial USA has increased its dividend for 2 consecutive years and Norwood Financial has increased its dividend for 3 consecutive years. Norwood Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation and Earnings
This table compares Heartland Financial USA and Norwood Financial’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Heartland Financial USA||$574.98 million||2.58||$117.00 million||$3.52||12.20|
|Norwood Financial||$49.56 million||4.23||$13.65 million||N/A||N/A|
Heartland Financial USA has higher revenue and earnings than Norwood Financial.
Risk and Volatility
Heartland Financial USA has a beta of 0.91, indicating that its share price is 9% less volatile than the S&P 500. Comparatively, Norwood Financial has a beta of 0.26, indicating that its share price is 74% less volatile than the S&P 500.
Norwood Financial beats Heartland Financial USA on 9 of the 13 factors compared between the two stocks.
Heartland Financial USA Company Profile
Heartland Financial USA, Inc., a multi-bank holding company, provides commercial, small business, and consumer banking services to individuals and businesses in the United States. It accepts various deposit products, including checking and other demand deposit accounts, NOW accounts, savings accounts, money market accounts, certificates of deposit, individual retirement accounts, health savings accounts, and other time deposits. The company also offers commercial and industrial loans; commercial real estate loans; real estate mortgage loans; small business loans; agricultural loans; consumer loans comprising motor vehicle loans, home improvement loans, home equity line of credit, and fixed rate home equity and personal lines of credit; and credit cards for commercial, business, and personal use. In addition, it provides online banking, mobile banking, telephone banking, bill payment, automated clearing house, wire transfer, zero balance account, transaction reporting, lock box, remote deposit capture, accounts receivable, investment sweep account, reconciliation, treasury management, foreign exchange, and various fraud prevention services, as well as commercial purchasing and merchant credit cards, debit cards, and automated teller machines. Further, the company offers investment services, such as mutual funds, annuities, retirement products, education savings products, brokerage services, employer sponsored plans, and insurance products, as well as vehicle, property and casualty, and life and disability insurance products. Additionally, it is involved in the community development, consumer finance, multi-line insurance agency, and property management businesses. The company operates through a network of 119 banking locations in Iowa, Illinois, Wisconsin, New Mexico, Arizona, Montana, Colorado, Minnesota, Kansas, Missouri, Texas, and California. Heartland Financial USA, Inc. was founded in 1981 and is headquartered in Dubuque, Iowa.
Norwood Financial Company Profile
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 various loans, such as 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; 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; trust and investment products; and cash management, direct deposit, remote deposit capture, mobile deposit capture, mobile payment, automated clearing house activity, title and real estate settlement, and Internet and mobile banking services. Further, it is involved 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 14 offices in Northeastern Pennsylvania; and 12 offices in Delaware and Sullivan Counties, New York, as well as 27 automated teller machines. The company was founded in 1870 and is headquartered in Honesdale, Pennsylvania.
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