Analyzing DNB Financial Corp Common Stock (DNBF) and First Financial Bancorp (FFBC)

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DNB Financial Corp Common Stock (NASDAQ: FFBC) and First Financial Bancorp (NASDAQ:FFBC) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, risk, institutional ownership, dividends, profitability, valuation and analyst recommendations.

Profitability

This table compares DNB Financial Corp Common Stock and First Financial Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DNB Financial Corp Common Stock 15.92% 9.42% 0.89%
First Financial Bancorp 25.41% 12.13% 1.44%

Dividends

DNB Financial Corp Common Stock pays an annual dividend of $0.28 per share and has a dividend yield of 0.8%. First Financial Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 2.6%. DNB Financial Corp Common Stock pays out 12.3% of its earnings in the form of a dividend. First Financial Bancorp pays out 49.7% 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.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for DNB Financial Corp Common Stock and First Financial Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DNB Financial Corp Common Stock 0 0 0 0 N/A
First Financial Bancorp 0 4 3 0 2.43

First Financial Bancorp has a consensus price target of $31.38, indicating a potential upside of 0.24%. Given First Financial Bancorp’s higher probable upside, analysts clearly believe First Financial Bancorp is more favorable than DNB Financial Corp Common Stock.

Earnings and Valuation

This table compares DNB Financial Corp Common Stock and First Financial Bancorp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
DNB Financial Corp Common Stock $48.40 million 3.12 $7.94 million $2.28 15.35
First Financial Bancorp $409.21 million 7.49 $96.78 million $1.61 19.44

First Financial Bancorp has higher revenue and earnings than DNB Financial Corp Common Stock. DNB Financial Corp Common Stock is trading at a lower price-to-earnings ratio than First Financial Bancorp, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

31.1% of DNB Financial Corp Common Stock shares are held by institutional investors. Comparatively, 74.2% of First Financial Bancorp shares are held by institutional investors. 13.5% of DNB Financial Corp Common Stock shares are held by insiders. Comparatively, 3.4% of First Financial Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk and Volatility

DNB Financial Corp Common Stock has a beta of 0.26, indicating that its stock price is 74% less volatile than the S&P 500. Comparatively, First Financial Bancorp has a beta of 1.03, indicating that its stock price is 3% more volatile than the S&P 500.

Summary

First Financial Bancorp beats DNB Financial Corp Common Stock on 12 of the 15 factors compared between the two stocks.

About DNB Financial Corp Common Stock

DNB Financial Corporation operates as the bank holding company for DNB First, National Association that provides a range of commercial banking products and services to individuals and small to medium sized businesses. The company offers deposit products, including money market, savings, demand, and NOW accounts; and time deposits, as well as certificates of deposit, including IRAs and brokered deposits. It also provides loan products comprising fixed and variable rate loans; funds for the purchase of business property or ventures, working capital lines, small business administration loans, and lease financing for equipment and for various other purposes; and home equity and home mortgages, as well as term loans for the purchase of consumer goods. In addition, it offers cash management, remote capture, Internet banking, letters of credit, and other lending services, as well as commercial sweep accounts; and various investment and insurance products, such as fixed and variable annuities, 401(k) plans and rollovers, stocks, self-directed and managed IRAs, bonds, mutual funds, brokerage, long term care insurance, 529 college savings plans, life insurance, separately managed investment accounts, disability insurance, and self-employed pension plans. Further, the company provides wealth management and trust services to individuals, businesses, and non-profit organizations; investment and fiduciary services, such as investment management, investment advisory, estate settlement, client bill paying, custody, financial planning, corporate trustee/trust administration, and power of attorney and guardian of the estate capacities; and safekeeping and other depository services, as well as securities brokerage and ATM services. It operates through 15 community offices located in Chester, Delaware, and Philadelphia counties, Pennsylvania. The company was founded in 1860 and is based in Downingtown, Pennsylvania.

About First Financial Bancorp

First Financial Bancorp. operates as the bank holding company for First Financial Bank that provides commercial banking and other banking, and banking-related services to individuals and businesses in Ohio, Indiana, and Kentucky. The company accepts various deposit products, such as interest-bearing and noninterest-bearing accounts, time deposits, and cash management services for commercial customers. It also provides real estate loans secured by residential property or commercial property; commercial and industrial loans for various purposes, including inventory, receivables, and equipment; consumer loans comprising new and used vehicle loans, second mortgages on residential real estate, and unsecured loans; and home equity lines of credit. In addition, the company offers a range of trust and wealth management services; and long-term, lease, and equipment financing services. As of December 31, 2017, it operated 94 banking centers. First Financial Bancorp. was founded in 1863 and is headquartered in Cincinnati, Ohio.

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