Reviewing First Bancorp, Inc (ME) (NASDAQ:FNLC) and Northeast Community Bancorp (NASDAQ:NECB)

First Bancorp, Inc (ME) (NASDAQ:FNLC) and Northeast Community Bancorp (NASDAQ:NECB) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, risk, valuation, profitability, earnings, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and price targets for First Bancorp, Inc (ME) and Northeast Community Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Bancorp, Inc (ME)	0	0	1	0	3.00
Northeast Community Bancorp	0	1	1	1	3.00

Profitability

This table compares First Bancorp, Inc (ME) and Northeast Community Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Bancorp, Inc (ME)	20.34%	13.09%	1.14%
Northeast Community Bancorp	28.16%	12.62%	2.16%

Valuation & Earnings

This table compares First Bancorp, Inc (ME) and Northeast Community Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Bancorp, Inc (ME)	$177.61 million	1.82	$34.39 million	$3.24	8.86
Northeast Community Bancorp	$158.21 million	2.11	$44.41 million	$3.22	7.50

Northeast Community Bancorp has lower revenue, but higher earnings than First Bancorp, Inc (ME). Northeast Community Bancorp is trading at a lower price-to-earnings ratio than First Bancorp, Inc (ME), indicating that it is currently the more affordable of the two stocks.

Dividends

First Bancorp, Inc (ME) pays an annual dividend of $1.48 per share and has a dividend yield of 5.2%. Northeast Community Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 3.3%. First Bancorp, Inc (ME) pays out 45.7% of its earnings in the form of a dividend. Northeast Community Bancorp pays out 24.8% 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. First Bancorp, Inc (ME) has raised its dividend for 6 consecutive years and Northeast Community Bancorp has raised its dividend for 2 consecutive years. First Bancorp, Inc (ME) is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

First Bancorp, Inc (ME) has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500. Comparatively, Northeast Community Bancorp has a beta of 0.37, indicating that its share price is 63% less volatile than the S&P 500.

Insider and Institutional Ownership

40.4% of First Bancorp, Inc (ME) shares are owned by institutional investors. Comparatively, 53.3% of Northeast Community Bancorp shares are owned by institutional investors. 5.1% of First Bancorp, Inc (ME) shares are owned by company insiders. Comparatively, 7.1% of Northeast Community Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Northeast Community Bancorp beats First Bancorp, Inc (ME) on 8 of the 15 factors compared between the two stocks.

About First Bancorp, Inc (ME)

The First Bancorp, Inc. operates as the holding company for First National Bank that provides a range of banking products and services to individuals and businesses. It offers various deposit products, including demand, NOW, time, savings, money market, and certificates of deposit accounts. The company also provides commercial loans comprising commercial real estate owner occupied, such as mortgage loans to finance investments in real property such as retail space, offices, industrial buildings, hotels, educational facilities, and other specific or mixed use properties; commercial real estate non-owner occupied loans; commercial construction to finance construction in a mix of owner- and nonowner occupied commercial real estate properties; and commercial and industrial loans, including revolving and term loan for financing working capital and/or capital investment. In addition, it offers commercial multifamily loans; residential real estate term and residential real estate construction loans; loans to municipalities in Maine for capitalized expenditures, construction projects, or tax anticipation notes; home equity revolving and term loans; and personal lines of credit and amortizing loans for various purposes, such as autos, recreational vehicles, debt consolidation, personal expenses, or overdraft protection. Further, the company offers private banking, financial planning, investment management, and trust services to individuals, businesses, non-profit organizations and municipalities; and brokerage, annuity, and various insurance products, as well as payment processing services. It operates through full-service banking offices in Lincoln, Knox, Waldo, Penobscot, Hancock, and Washington counties in the Mid-Coast, Eastern, and Down East regions of Maine. The company was formerly known as First National Lincoln Corporation and changed its name to The First Bancorp, Inc. in April 2008. The First Bancorp, Inc. was founded in 1864 and is based in Damariscotta, Maine.

About Northeast Community Bancorp

Northeast Community Bancorp, Inc. operates as the holding company for NorthEast Community Bank that provides financial services for individuals and businesses. It accepts various deposit instruments, including checking accounts, money market accounts, regular savings accounts, and non-interest bearing demand accounts, as well as certificates of deposits. The company also offers construction, commercial and industrial, multifamily and mixed-use real estate, non-residential real estate loans, and consumer loans. In addition, it invests in various types of liquid assets, including U.S. Treasury obligations, municipal securities, deposits at the Federal Home Loan Bank of New York, and certificates of deposit of federally insured institutions, as well as securities of various federal agencies, and of state and municipal governments. Further, the company offers financial planning and investment advisory services; and life insurance products and fixed-rate annuities. It operates full-service branches located in Bronx, New York, Orange, Rockland, and Sullivan Counties in New York and Essex, Middlesex, and Norfolk Counties in Massachusetts; and loan production offices located in White Plains, New York, and New City counties in New York and Danvers, Massachusetts. Northeast Community Bancorp, Inc. was founded in 1934 and is headquartered in White Plains, New York.