Financial comparison: Richmond Mutual Bancorporation (NASDAQ:RMBI) and CapStar Financial (NASDAQ:CSTR)


CapStar Financial (NASDAQ: CSTRGet a rating) and Richmond Mutual Bancorporation (NASDAQ:RMBIGet a rating) are both small cap finance companies, but which is the better investment? We’ll compare the two companies based on institutional ownership strength, analyst recommendations, dividends, profitability, earnings, risk and valuation.

Profitability

This table compares the net margins, return on equity and return on assets of CapStar Financial and Richmond Mutual Bancorporation.

Net margins Return on equity return on assets
CapStar Financial 34.83% 13.11% 1.54%
Richmond Mutual Insurance Society 22.31% 6.42% 0.94%

Analyst Recommendations

This is a breakdown of the current ratings and recommendations for CapStar Financial and Richmond Mutual Bancorporation, as provided by MarketBeat.com.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
CapStar Financial 0 0 4 0 3.00
Richmond Mutual Insurance Society 0 0 0 0 N / A

CapStar Financial currently has a consensus price target of $24.33, suggesting a potential upside of 19.75%. Given CapStar Financial’s possible higher upside, equity research analysts clearly believe that CapStar Financial is more favorable than Richmond Mutual Bancorporation.

Insider and Institutional Ownership

43.1% of CapStar Financial shares are held by institutional investors. By comparison, 18.9% of the shares of Richmond Mutual Bancorporation are held by institutional investors. 0.3% of CapStar Financial shares are held by insiders of the company. By comparison, 5.9% of the shares of Richmond Mutual Bancorporation are held by insiders of the company. Strong institutional ownership indicates that endowments, hedge funds, and large fund managers believe a stock is poised for long-term growth.

Volatility and risk

CapStar Financial has a beta of 0.98, meaning its stock price is 2% less volatile than the S&P 500. Comparatively, Richmond Mutual Bancorporation has a beta of 0.82, meaning its stock price is 18 % less volatile than the S&P 500.

Benefits and evaluation

This table compares the revenue, earnings per share and valuation of CapStar Financial and Richmond Mutual Bancorporation.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
CapStar Financial $141.14 million 3.20 $48.68 million $2.17 9.36
Richmond Mutual Insurance Society $51.34 million 3.83 $11.15 million $1.01 15.79

CapStar Financial has higher revenue and profit than Richmond Mutual Bancorporation. CapStar Financial trades at a lower price-to-earnings ratio than Richmond Mutual Bancorporation, indicating that it is currently the more affordable of the two stocks.

Dividends

CapStar Financial pays an annual dividend of $0.24 per share and has a dividend yield of 1.2%. Richmond Mutual Bancorporation pays an annual dividend of $0.40 per share and has a dividend yield of 2.5%. CapStar Financial pays 11.1% of its earnings as a dividend. Richmond Mutual Bancorporation pays 39.6% of its profits as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings over the next few years. CapStar Financial has increased its dividend for 2 consecutive years and Richmond Mutual Bancorporation has increased its dividend for 1 consecutive year.

Summary

CapStar Financial beats Richmond Mutual Bancorporation on 12 out of 16 factors compared between the two stocks.

About CapStar Financial (Get a rating)

CapStar Financial Holdings, Inc. operates as a bank holding company for CapStar Bank which provides consumer and business banking services located primarily in Tennessee, United States. Its deposit products and services include demand deposits, interest-bearing transaction accounts, money market accounts, term and savings deposits, certificates of deposit and CDARS reciprocal products. The Company also offers commercial and consumer real estate, construction and land development, commercial and industrial, consumer, PPP and other loans. In addition, it offers mortgage banking products and services; private banking and wealth management services for owners and operators of business clients and other high net worth individuals; and correspondent banking services to community banks. Additionally, the Company offers telephone and online banking, direct deposit, mobile banking, safe deposit boxes, remote deposits and cash management services for individuals and small and medium businesses. CapStar Financial Holdings, Inc. was founded in 2007 and is headquartered in Nashville, Tennessee.

About Richmond Mutual Bancorporation (Get a rating)

Richmond Mutual Bancorporation, Inc. operates as a holding company for First Bank Richmond which provides various banking services. The company accepts various deposits, including savings deposit accounts, NOW money market accounts and current accounts, and certificates of deposit. It also offers a range of lending products, such as multi-family and commercial real estate loans, commercial and industrial loans, construction and development loans, residential real estate loans and consumer loans. In addition, the company is engaged in finance leasing activities; and the provision of fee-based financial services including trust and estate administration, investment management, pension plan administration and private banking. It operates through 12 full-service and one limited-service banking offices with seven full-service and one limited-service offices located in Indiana; five offices located in Ohio; a full-service bank office and four other branches are located in Richmond, Indiana; two other offices in Cambridge City, Centerville, Richmond and Shelbyville, Indiana; two offices in Sidney and Ohio; two offices in Piqua and one office in Troy, Ohio; and a loan production office in Columbus, Ohio. Richmond Mutual Bancorporation, Inc. was founded in 1887 and is headquartered in Richmond, Indiana.



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