Head to Head Comparison: Bank of the James Financial Group (NASDAQ:BOTJ) & Heartland Financial USA (NASDAQ:HTLF)

Bank of the James Financial Group (NASDAQ:BOTJ) and Heartland Financial USA (NASDAQ:HTLF) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their valuation, dividends, analyst recommendations, risk, earnings, profitability and institutional ownership.

Profitability

This table compares Bank of the James Financial Group and Heartland Financial USA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank of the James Financial Group	13.29%	12.48%	0.80%
Heartland Financial USA	8.79%	10.81%	1.09%

Earnings & Valuation

This table compares Bank of the James Financial Group and Heartland Financial USA”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank of the James Financial Group	$59.78 million	1.04	$7.94 million	$1.75	7.77
Heartland Financial USA	$932.87 million	2.97	$79.92 million	$1.79	36.13

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

Institutional & Insider Ownership

18.5% of Bank of the James Financial Group shares are owned by institutional investors. Comparatively, 71.6% of Heartland Financial USA shares are owned by institutional investors. 15.3% of Bank of the James Financial Group shares are owned by company insiders. Comparatively, 1.8% of Heartland Financial USA shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings for Bank of the James Financial Group and Heartland Financial USA, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank of the James Financial Group	0	0	0	0	0.00
Heartland Financial USA	0	1	1	1	3.00

Heartland Financial USA has a consensus price target of $46.67, suggesting a potential downside of 27.84%. Given Heartland Financial USA’s stronger consensus rating and higher possible upside, analysts plainly believe Heartland Financial USA is more favorable than Bank of the James Financial Group.

Risk & Volatility

Bank of the James Financial Group has a beta of 0.78, indicating that its share price is 22% less volatile than the S&P 500. Comparatively, Heartland Financial USA has a beta of 0.98, indicating that its share price is 2% less volatile than the S&P 500.

Dividends

Bank of the James Financial Group pays an annual dividend of $0.40 per share and has a dividend yield of 2.9%. Heartland Financial USA pays an annual dividend of $1.20 per share and has a dividend yield of 1.9%. Bank of the James Financial Group pays out 22.9% of its earnings in the form of a dividend. Heartland Financial USA pays out 67.0% 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. Bank of the James Financial Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Heartland Financial USA beats Bank of the James Financial Group on 12 of the 17 factors compared between the two stocks.

About Bank of the James Financial Group

Bank of the James Financial Group, Inc. operates as the bank holding company for Bank of the James that provides general retail and commercial banking services to individuals, businesses, associations and organizations, and governmental authorities in Virginia, the United States. It offers checking, savings, individual retirement, and health care saving accounts, as well as other time deposits, including money market accounts and certificates of deposit. The company also provides loans to small- and medium-sized businesses for the purchases of equipment, facilities upgrades, inventory acquisition, and various working capital purposes; commercial and residential construction and development loans; commercial real estate mortgage loans; residential mortgage loans; and secured and unsecured consumer loans, such as lines of credit and overdraft lines of credit, as well as personal, automobile, installment, demand, and home equity loans for personal, family, or household purposes. In addition, it offers other banking services, including safe deposit boxes, traveler's checks, direct deposit of payroll and social security checks, automatic drafts for various accounts, treasury management, and credit card merchant services. Further, the company provides mortgage banking; investment advisory services; securities brokerage and investment services; and telephone and internet banking services comprising online bill pay, as well as acts as an agent for insurance and annuity products. The company was founded in 1999 and is headquartered in Lynchburg, Virginia.

About Heartland Financial USA

Heartland Financial USA, Inc., a bank holding company, provides commercial, small business, and consumer banking services to individuals and businesses in the United States. The company accepts various deposit products, including checking, demand deposit accounts, NOW accounts, savings, money market, and individual retirement; certificates of deposit; and other time deposits. It offers loans, including commercial and industrial, commercial real estate, agricultural, small business, and real estate mortgage loans; consumer loans comprising motor vehicle, home improvement, home equity line of credit, and fixed rate home equity and personal lines of credit; and credit cards for commercial, business, and personal use. In addition, the company provides business and personal online banking, and mobile banking; bill payment, remote deposit capture, and treasury management services; debit cards; automated teller machines; and automated clearing house services, wire transfers, insured cash sweeps, zero balance accounts, lockbox, image cash letter, remote deposit capture, commercial cards for travel and entertainment purchasing, merchant services to receive credit card payments, investment sweep accounts, reconciliation services, online invoice processing, foreign exchange and positive pay fraud prevention services for checks and automated clearing house services payments. Further, it offers wealth management, trust services, brokerage services, and fixed rate annuity products; and investment services, including mutual funds, individual retirement products, and education savings products. Heartland Financial USA, Inc. was founded in 1981 and is headquartered in Denver, Colorado.