German American Bancorp (NASDAQ:GABC) and Chester Bancorp (OTCMKTS:CNBA) Critical Analysis

German American Bancorp (NASDAQ:GABC) and Chester Bancorp (OTCMKTS:CNBA) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, risk and institutional ownership.

Risk & Volatility

German American Bancorp has a beta of 0.6, suggesting that its share price is 40% less volatile than the S&P 500. Comparatively, Chester Bancorp has a beta of -0.51, suggesting that its share price is 151% less volatile than the S&P 500.

Earnings and Valuation

This table compares German American Bancorp and Chester Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
German American Bancorp	$487.40 million	3.29	$112.64 million	$3.61	11.82
Chester Bancorp	N/A	N/A	N/A	N/A	N/A

German American Bancorp has higher revenue and earnings than Chester Bancorp.

Dividends

German American Bancorp pays an annual dividend of $1.24 per share and has a dividend yield of 2.9%. Chester Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 12.8%. German American Bancorp pays out 34.3% of its earnings in the form of a dividend. German American Bancorp has raised its dividend for 13 consecutive years.

Insider and Institutional Ownership

46.9% of German American Bancorp shares are held by institutional investors. 3.2% of German American Bancorp shares are held by insiders. Comparatively, 38.8% of Chester Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares German American Bancorp and Chester Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
German American Bancorp	27.09%	11.98%	1.62%
Chester Bancorp	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of current ratings and target prices for German American Bancorp and Chester Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
German American Bancorp	0	1	3	0	2.75
Chester Bancorp	0	0	0	0	0.00

German American Bancorp currently has a consensus target price of $47.67, indicating a potential upside of 11.74%. Given German American Bancorp’s stronger consensus rating and higher possible upside, research analysts clearly believe German American Bancorp is more favorable than Chester Bancorp.

Summary

German American Bancorp beats Chester Bancorp on 10 of the 13 factors compared between the two stocks.

About German American Bancorp

German American Bancorp, Inc. operates as a financial holding company for German American Bank that provides retail and commercial banking services. The company operates through three segments: Core Banking, Wealth Management Services, and Insurance Operations. The Core Banking segment accepts deposits from the general public; and originates consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, as well as sells residential mortgage loans in the secondary market. The Wealth Management segment provides trust, investment advisory, brokerage, and retirement planning services. The Insurance Operations segment offers a range of personal and corporate property and casualty insurance products. It also offers checking, saving, and individual retirement accounts; certificates of deposit; wire transfer; credit cards; home equity, mortgages, and small business; treasury management; and online and mobile banking, bill pay, digital wallet, mobile check deposit, credit score and report, money management, and estatements, as well as wealth advisory. German American Bancorp, Inc. was founded in 1910 and is based in Jasper, Indiana.

About Chester Bancorp

Chester Bancorp, Inc. operates as the holding company for Chester National Bank that provides various banking products and services to individuals and businesses in Chester, Illinois. It offers checking accounts, such as regular checking, student checking, golden checking, and club checking accounts; savings accounts, including statement savings, Christmas club, and money market accounts; and certificate of deposits and individual retirement accounts. The company also provides loans comprising mortgage, construction, lot, home equity, consumer, and business loans; and reorder check services. It operates two full service offices in Sparta, Illinois; and Perryville, Missouri. Chester Bancorp, Inc. was founded in 1996 and is based in Chester, Illinois.