Webster Financial (NYSE:WBS) vs. 1st Colonial Bancorp (OTCMKTS:FCOB) Head-To-Head Review

1st Colonial Bancorp (OTCMKTS:FCOB) and Webster Financial (NYSE:WBS) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, risk, valuation, earnings, analyst recommendations, profitability and dividends.

Analyst Ratings

This is a summary of current ratings and target prices for 1st Colonial Bancorp and Webster Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
1st Colonial Bancorp	0	0	0	0	N/A
Webster Financial	0	1	11	0	2.92

Webster Financial has a consensus price target of $55.73, indicating a potential upside of 26.37%. Given Webster Financial’s higher probable upside, analysts clearly believe Webster Financial is more favorable than 1st Colonial Bancorp.

Profitability

This table compares 1st Colonial Bancorp and Webster Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
1st Colonial Bancorp	16.80%	11.14%	0.92%
Webster Financial	19.81%	11.81%	1.31%

Institutional & Insider Ownership

13.4% of 1st Colonial Bancorp shares are owned by institutional investors. Comparatively, 85.6% of Webster Financial shares are owned by institutional investors. 0.9% of Webster Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Risk and Volatility

1st Colonial Bancorp has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500. Comparatively, Webster Financial has a beta of 1.3, suggesting that its share price is 30% more volatile than the S&P 500.

Earnings & Valuation

This table compares 1st Colonial Bancorp and Webster Financial’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
1st Colonial Bancorp	$42.11 million	1.78	$7.43 million	$1.55	10.13
Webster Financial	$3.94 billion	1.92	$867.84 million	$4.88	9.04

Webster Financial has higher revenue and earnings than 1st Colonial Bancorp. Webster Financial is trading at a lower price-to-earnings ratio than 1st Colonial Bancorp, indicating that it is currently the more affordable of the two stocks.

Summary

Webster Financial beats 1st Colonial Bancorp on 12 of the 13 factors compared between the two stocks.

About 1st Colonial Bancorp

1st Colonial Bancorp, Inc. operates as the bank holding company for 1st Colonial Community Bank that provides a range of business and consumer financial services in New Jersey. The company offers various deposit products, including savings accounts, money market accounts, certificates of deposit, club accounts, and business and personal checking accounts. It also provides home equity loans, home equity lines of credit, personal and vehicle loans, residential and commercial mortgages, construction loans, business lines of credit, equipment and vehicle financing, real estate loans, working capital line of credit, and business acquisition loans, as well as small business administration loans. In addition, the company offers cash management services comprising remote deposit capture, ACH/wire transfer, night deposit drop, and merchant services; safe deposit boxes; and coin counting, online and mobile banking, debit card, and ATM services. The company was founded in 2000 and is headquartered in Mount Laurel, New Jersey.

About Webster Financial

Webster Financial Corporation operates as the bank holding company for Webster Bank, National Association that provides a range of financial products and services to individuals, families, and businesses in the United States. It operates through three segments: Commercial Banking, HSA Bank, and Consumer Banking. The Commercial Banking segment offers commercial real estate and equipment financing, business banking, asset-based lending, and commercial services; public sector finance; mortgage warehouse financing; sponsor and specialty financing services; credit, deposit, and cash flow management services; and wealth management solutions to business owners and operators, including trust, asset management, financial planning, insurance, retirement, and investment products, as well as treasury management services comprising derivative, treasury, accounts payable, accounts receivable, and trade products and services. This segment also provides commercial services, such as accounts receivable factoring and trade financing, payroll funding, and business process outsourcing. The HSA Bank segment offers health savings accounts, health reimbursement arrangements, flexible spending accounts, and commuter benefit services that are distributed directly to employers and individual consumers, as well as through national and regional insurance carriers, benefit consultants, and financial advisors. The Consumer Banking segment provides consumer deposit and fee-based services, residential mortgages, home equity lines, secured and unsecured loans, and credit cards to consumers; and small business banking products, such as credit, deposit, and cash flow management products to businesses and professional service firms. The company offers online and mobile banking services. Webster Financial Corporation was founded in 1935 and is headquartered in Stamford, Connecticut.