Head-To-Head Contrast: Mercantile Bank (MBWM) and Its Competitors

Mercantile Bank (NASDAQ:MBWM) is one of 919 public companies in the “Banks” industry, but how does it contrast to its peers? We will compare Mercantile Bank to related companies based on the strength of its risk, profitability, valuation, dividends, institutional ownership, analyst recommendations and earnings.

Profitability

This table compares Mercantile Bank and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mercantile Bank	24.42%	13.37%	1.43%
Mercantile Bank Competitors	15.64%	9.43%	0.93%

Earnings & Valuation

This table compares Mercantile Bank and its peers revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Mercantile Bank	$371.80 million	$88.75 million	10.88
Mercantile Bank Competitors	$37.93 billion	$2.42 billion	21.36

Mercantile Bank’s peers have higher revenue and earnings than Mercantile Bank. Mercantile Bank is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Volatility & Risk

Mercantile Bank has a beta of 0.82, meaning that its share price is 18% less volatile than the S&P 500. Comparatively, Mercantile Bank’s peers have a beta of 0.61, meaning that their average share price is 39% less volatile than the S&P 500.

Institutional & Insider Ownership

58.6% of Mercantile Bank shares are held by institutional investors. Comparatively, 47.8% of shares of all “Banks” companies are held by institutional investors. 2.5% of Mercantile Bank shares are held by insiders. Comparatively, 9.7% of shares of all “Banks” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

Mercantile Bank pays an annual dividend of $1.60 per share and has a dividend yield of 2.6%. Mercantile Bank pays out 28.5% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 8.9% and pay out 28.9% of their earnings in the form of a dividend. Mercantile Bank has raised its dividend for 14 consecutive years.

Analyst Recommendations

This is a summary of current ratings for Mercantile Bank and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mercantile Bank	0	3	2	1	2.67
Mercantile Bank Competitors	7492	30246	27845	1488	2.35

Mercantile Bank currently has a consensus target price of $62.20, suggesting a potential upside of 1.90%. As a group, “Banks” companies have a potential upside of 14.64%. Given Mercantile Bank’s peers higher probable upside, analysts clearly believe Mercantile Bank has less favorable growth aspects than its peers.

Summary

Mercantile Bank beats its peers on 8 of the 15 factors compared.

About Mercantile Bank

Mercantile Bank Corporation is a Michigan-based bank holding company headquartered in Grand Rapids. Through its subsidiary, Mercantile Bank, it provides commercial and personal banking services to individuals, businesses and organizations across Michigan. The bank offers deposit accounts and lending products, including commercial, real estate, mortgage and consumer loans. Its services also include online and mobile banking and other banking solutions for businesses and individuals. Mercantile Bank traces its history to 1997, when it began operations in West Michigan.