Critical Contrast: IF Bancorp (NASDAQ:IROQ) and Finward Bancorp (OTCMKTS:FNWD)

IF Bancorp (NASDAQ:IROQ – Get Rating) and Finward Bancorp (OTCMKTS:FNWD – Get Rating) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, earnings, risk, dividends, analyst recommendations, institutional ownership and valuation.

Insider and Institutional Ownership

22.4% of IF Bancorp shares are owned by institutional investors. Comparatively, 23.0% of Finward Bancorp shares are owned by institutional investors. 13.8% of IF Bancorp shares are owned by company insiders. Comparatively, 13.7% of Finward Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares IF Bancorp and Finward Bancorp’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
IF Bancorp	$30.30 million	1.56	$5.78 million	$1.59	8.90
Finward Bancorp	$83.54 million	1.17	$15.08 million	$3.54	6.42

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

Profitability

This table compares IF Bancorp and Finward Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
IF Bancorp	15.12%	7.18%	0.61%
Finward Bancorp	17.40%	11.64%	0.74%

Dividends

IF Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.8%. Finward Bancorp pays an annual dividend of $1.24 per share and has a dividend yield of 5.5%. IF Bancorp pays out 25.2% of its earnings in the form of a dividend. Finward Bancorp pays out 35.0% 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. IF Bancorp has increased its dividend for 2 consecutive years.

Volatility and Risk

IF Bancorp has a beta of 0.53, suggesting that its stock price is 47% less volatile than the S&P 500. Comparatively, Finward Bancorp has a beta of 0.38, suggesting that its stock price is 62% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for IF Bancorp and Finward Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
IF Bancorp	0	0	0	0	N/A
Finward Bancorp	0	1	1	0	2.50

Finward Bancorp has a consensus target price of $36.00, suggesting a potential upside of 58.31%. Given Finward Bancorp’s higher possible upside, analysts plainly believe Finward Bancorp is more favorable than IF Bancorp.

Summary

Finward Bancorp beats IF Bancorp on 10 of the 16 factors compared between the two stocks.

About IF Bancorp

(Get Rating)

IF Bancorp, Inc. operates as a holding company, which engages in directing, planning, and coordinating the business activities of Iroquois Federal Savings. The firm through its subsidiary, offers variety of deposits accounts, including savings accounts, certificate of deposit, money market accounts, commercial and personal checking accounts, individual retirement accounts, and health savings accounts. The company was founded in March 2011 and is headquartered in Watseka, IL.

About Finward Bancorp

(Get Rating)

Finward Bancorp is a bank holding company, which engages in the provision of financial services. It offers checking and savings accounts, loans, eBanking, cash management, investments, retirement plans, and trust funds. The company was founded on January 31, 1994 and is headquartered in Munster, IN.