Enterprise Bancorp (NASDAQ:EBTC) and First Foundation (NASDAQ:FFWM) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, profitability, earnings, institutional ownership, risk and analyst recommendations.
Enterprise Bancorp pays an annual dividend of $0.58 per share and has a dividend yield of 1.7%. First Foundation does not pay a dividend. Enterprise Bancorp has increased its dividend for 5 consecutive years.
Institutional & Insider Ownership
21.3% of Enterprise Bancorp shares are held by institutional investors. Comparatively, 55.8% of First Foundation shares are held by institutional investors. 19.0% of Enterprise Bancorp shares are held by company insiders. Comparatively, 14.3% of First Foundation shares are held 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.
Risk and Volatility
Enterprise Bancorp has a beta of 0.73, meaning that its share price is 27% less volatile than the S&P 500. Comparatively, First Foundation has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.
Valuation & Earnings
This table compares Enterprise Bancorp and First Foundation’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Enterprise Bancorp||$120.71 million||3.28||$19.39 million||N/A||N/A|
|First Foundation||$175.52 million||3.95||$27.58 million||$0.97||16.11|
First Foundation has higher revenue and earnings than Enterprise Bancorp.
This table compares Enterprise Bancorp and First Foundation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of current ratings and target prices for Enterprise Bancorp and First Foundation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
First Foundation has a consensus price target of $20.50, indicating a potential upside of 31.16%. Given First Foundation’s higher probable upside, analysts plainly believe First Foundation is more favorable than Enterprise Bancorp.
Enterprise Bancorp Company Profile
Enterprise Bancorp, Inc. operates as the holding company for Enterprise Bank and Trust Company that provides various banking products and services primarily in the greater Merrimack Valley and North Central regions of Massachusetts and Southern New Hampshire. The company offers commercial checking, business and municipal savings accounts, term certificates of deposit, money market and business sweep accounts, interest on lawyers trust accounts, escrow management accounts, personal checking accounts, savings accounts, and individual retirement accounts, as well as checking and simplified employee pension accounts. It also provides commercial mortgage loans, construction and land development loans, secured and unsecured commercial loans and lines of credit, and letters of credit; and conventional residential mortgage loans, home equity loans and lines, residential construction loans on primary and secondary residences, and secured and unsecured personal loans and lines of credit, as well as equipment lease financing services. In addition, the company offers cash management services; various investment advisory and management services, including customized investment management and trust services to individuals, family groups, commercial businesses, trusts, foundations, non-profit organizations, and endowments; and insurance products, such as property and casualty, employee benefits, and risk-management solutions. As of January 25, 2018, it had 24 full-service branches located in the Massachusetts communities of Lowell, Acton, Andover, Billerica, Chelmsford, Dracut, Fitchburg, Lawrence, Leominster, Methuen, Tewksbury, Tyngsborough, and Westford; and the New Hampshire communities of Derry, Hudson, Nashua, Pelham, Salem, and Windham. The company primarily serves business entities, non-profit organizations, professionals, and individuals. Enterprise Bancorp, Inc. was founded in 1989 and is headquartered in Lowell, Massachusetts.
First Foundation Company Profile
First Foundation Inc., through its subsidiaries, provides financial services to individuals, businesses, and other organizations in the United States. It operates in two segments, Banking; and Investment Management and Wealth Planning. The company offers a range of bank deposit products, including personal and business checking accounts, savings accounts, interest-bearing negotiable order of withdrawal accounts, money market accounts, and time certificates of deposit; and loan products consisting of multifamily and single family residential real estate loans, commercial real estate loans, and commercial term loans and lines of credit, as well as consumer loans, such as personal installment loans and lines of credit, and home equity lines of credit. It also provides various specialized services comprising trust services, online banking, remote deposit capture, merchant credit card services, ATM cards, Visa debit cards, and business sweep accounts, as well as insurance brokerage services. In addition, the company offers investment management and financial planning services; advisory and coordination services in the areas of estate planning, retirement planning, charitable and business ownership issues, and issues faced by executives of publicly-traded companies; and financial, investment, and economic advisory and related services. Further, it provides support services, including the processing and transmission of financial and economic data for charitable organizations. The company was founded in 1985 and is headquartered in Irvine, California.
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