Head to Head Survey: Old National Bancorp (NASDAQ:ONB) versus First Financial Bancorp (NASDAQ:FFBC)

First Financial Bancorp (NASDAQ:FFBC) and Old National Bancorp (NASDAQ:ONB) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, analyst recommendations, valuation, institutional ownership, earnings, profitability and risk.

Earnings and Valuation

This table compares First Financial Bancorp and Old National Bancorp’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Financial Bancorp $738.95 million 1.72 $198.07 million $2.14 6.07
Old National Bancorp $929.70 million 2.39 $238.21 million $1.45 9.28

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

Institutional and Insider Ownership

73.9% of First Financial Bancorp shares are held by institutional investors. Comparatively, 68.2% of Old National Bancorp shares are held by institutional investors. 2.0% of First Financial Bancorp shares are held by insiders. Comparatively, 1.6% of Old National Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Risk & Volatility

First Financial Bancorp has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500. Comparatively, Old National Bancorp has a beta of 0.96, indicating that its stock price is 4% less volatile than the S&P 500.

Profitability

This table compares First Financial Bancorp and Old National Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Financial Bancorp 23.05% 7.97% 1.18%
Old National Bancorp 21.24% 7.84% 1.07%

Analyst Ratings

This is a breakdown of current ratings and price targets for First Financial Bancorp and Old National Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Financial Bancorp 0 1 0 0 2.00
Old National Bancorp 0 2 1 0 2.33

First Financial Bancorp presently has a consensus price target of $24.00, suggesting a potential upside of 84.90%. Old National Bancorp has a consensus price target of $17.00, suggesting a potential upside of 26.39%. Given First Financial Bancorp’s higher possible upside, analysts clearly believe First Financial Bancorp is more favorable than Old National Bancorp.

Dividends

First Financial Bancorp pays an annual dividend of $0.92 per share and has a dividend yield of 7.1%. Old National Bancorp pays an annual dividend of $0.56 per share and has a dividend yield of 4.2%. First Financial Bancorp pays out 43.0% of its earnings in the form of a dividend. Old National Bancorp pays out 38.6% 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 Financial Bancorp has raised its dividend for 3 consecutive years and Old National Bancorp has raised its dividend for 1 consecutive years. First Financial Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

First Financial Bancorp beats Old National Bancorp on 10 of the 17 factors compared between the two stocks.

About First Financial Bancorp

First Financial Bancorp. operates as the bank holding company for First Financial Bank that provides commercial banking and related services to individuals and businesses in Ohio, Indiana, Kentucky, and Illinois. 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 commercial financing to the insurance industry, registered investment advisors, certified public accountants, indirect auto finance companies, and restaurant franchisees. Further, it offers a range of trust and wealth management services; and long-term, lease, and equipment financing services. As of December 31, 2018, the company operated 67 banking centers in Ohio; 3 banking centers in Illinois; 73 banking centers in Indiana; and 16 banking centers in Kentucky. First Financial Bancorp. was founded in 1863 and is headquartered in Cincinnati, Ohio.

About Old National Bancorp

Old National Bancorp operates as the holding company for Old National Bank that provides various financial services to individual and commercial customers in the United States. The company offers deposit accounts, including noninterest-bearing demand, interest-bearing checking, NOW, savings and money market, and time deposits; and loans, such as home equity lines of credit, residential real estate loans, consumer loans, commercial loans, commercial real estate loans, letters of credit, and lease financing. It also provides debit and ATM cards, telephone access, and online banking, as well as other electronic and mobile banking services; cash management, private banking, brokerage, trust, and investment advisory services; wealth management, investment, and foreign currency services; and treasury management, merchant, health savings, and capital markets services, as well as community development lending and equity investment solutions. As of December 31, 2018, the company operated 191 banking centers located primarily in Indiana, Kentucky, Michigan, Wisconsin, and Minnesota. Old National Bancorp was founded in 1834 and is headquartered in Evansville, Indiana.

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