Analyzing SB Financial Group (NASDAQ:SBFG) & QNB (OTCMKTS:QNBC)

QNB (OTCMKTS:QNBC) and SB Financial Group (NASDAQ:SBFG) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, earnings, analyst recommendations, institutional ownership, valuation, dividends and profitability.

Analyst Ratings

This is a summary of current ratings and price targets for QNB and SB Financial Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QNB	0	0	0	0	0.00
SB Financial Group	0	1	1	0	2.50

Profitability

This table compares QNB and SB Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
QNB	14.15%	13.20%	0.80%
SB Financial Group	15.35%	11.02%	0.99%

Valuation & Earnings

This table compares QNB and SB Financial Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
QNB	$99.60 million	1.41	$14.09 million	$3.77	9.90
SB Financial Group	$91.03 million	1.46	$13.97 million	$2.20	9.58

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

Dividends

QNB pays an annual dividend of $1.52 per share and has a dividend yield of 4.1%. SB Financial Group pays an annual dividend of $0.62 per share and has a dividend yield of 2.9%. QNB pays out 40.3% of its earnings in the form of a dividend. SB Financial Group pays out 28.2% 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. SB Financial Group has raised its dividend for 12 consecutive years.

Risk and Volatility

QNB has a beta of 0.45, meaning that its share price is 55% less volatile than the S&P 500. Comparatively, SB Financial Group has a beta of 0.22, meaning that its share price is 78% less volatile than the S&P 500.

Institutional & Insider Ownership

0.7% of QNB shares are held by institutional investors. Comparatively, 66.7% of SB Financial Group shares are held by institutional investors. 14.5% of QNB shares are held by insiders. Comparatively, 5.7% of SB Financial Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

About QNB

QNB Corp. operates as the bank holding company for QNB Bank that engages in the provision of commercial and retail banking products, and retail brokerage services. It offers various deposit products, which include demand and savings accounts, such as money market, interest-bearing demand, club, traditional statement savings, and online savings accounts; and time deposits comprising certificates of deposit and individual retirement accounts. The company also provides commercial and industrial loans, commercial and residential real estate loans, construction and land development loans, indirect lease financing, 1-4 family residential mortgage loans, home equity loans and lines of credit, and consumer loans. In addition, it offers retail brokerage and advisory services; credit cards and insurance products; merchant services; ATM and debit card services; and internet and mobile-banking, electronic bill pay, and remote deposit capture services. The company serves other community banks, thrift institutions, credit unions and other non-bank financial organizations, such as mutual fund companies, insurance companies, and brokerage companies. QNB Corp. was founded in 1877 and is based in Quakertown, Pennsylvania.

About SB Financial Group

SB Financial Group, Inc. operates as the financial holding company for the State Bank and Trust Company that provides a range of commercial banking and wealth management services to individual and corporate customers primarily in Ohio, Indiana, and Michigan. It offers checking, savings, money market accounts, as well as time certificates of deposit; and commercial, consumer, agricultural, and residential mortgage loans. The company also provides automatic teller machine, personal and corporate trust, commercial leasing, bank credit card, safe deposit box rental, internet banking, private client group, and other personalized banking products and services; and various trust and financial services comprising asset management services for individuals and corporate employee benefit plans, as well as brokerage services. In addition, it sells insurance products to retail and commercial customers. The company was formerly known as Rurban Financial Corp. and changed its name to SB Financial Group, Inc. in April 2013. SB Financial Group, Inc. was founded in 1902 and is based in Defiance, Ohio.