Analyzing First Financial Bancorp. (NASDAQ:FFBC) and German American Bancorp (NASDAQ:GABC)

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

Valuation and Earnings

This table compares German American Bancorp and First Financial Bancorp.”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
German American Bancorp	$330.60 million	4.32	$83.81 million	$2.86	13.33
First Financial Bancorp.	$884.98 million	2.59	$228.83 million	$2.70	8.62

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

Insider & Institutional Ownership

46.9% of German American Bancorp shares are owned by institutional investors. Comparatively, 77.2% of First Financial Bancorp. shares are owned by institutional investors. 6.2% of German American Bancorp shares are owned by company insiders. Comparatively, 1.1% of First Financial Bancorp. shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
German American Bancorp	22.19%	12.40%	1.53%
First Financial Bancorp.	20.64%	10.72%	1.46%

Analyst Recommendations

This is a summary of recent ratings for German American Bancorp and First Financial Bancorp., as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
German American Bancorp	0	2	1	0	2.33
First Financial Bancorp.	0	5	3	0	2.38

German American Bancorp presently has a consensus target price of $45.50, suggesting a potential upside of 19.36%. First Financial Bancorp. has a consensus target price of $29.50, suggesting a potential upside of 26.77%. Given First Financial Bancorp.’s stronger consensus rating and higher possible upside, analysts plainly believe First Financial Bancorp. is more favorable than German American Bancorp.

Volatility and Risk

German American Bancorp has a beta of 0.66, meaning that its share price is 34% less volatile than the S&P 500. Comparatively, First Financial Bancorp. has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500.

Dividends

German American Bancorp pays an annual dividend of $1.16 per share and has a dividend yield of 3.0%. First Financial Bancorp. pays an annual dividend of $1.00 per share and has a dividend yield of 4.3%. German American Bancorp pays out 40.6% of its earnings in the form of a dividend. First Financial Bancorp. pays out 37.0% 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. German American Bancorp has raised its dividend for 13 consecutive years and First Financial Bancorp. has raised its dividend for 1 consecutive years. First Financial Bancorp. is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

First Financial Bancorp. beats German American Bancorp on 9 of the 17 factors compared between the two stocks.

About German American Bancorp

German American Bancorp, Inc. operates as a financial holding company for German American Bank that provides retail and commercial banking services. The company operates through three segments: Core Banking, Wealth Management Services, and Insurance Operations. The Core Banking segment accepts deposits from the general public; and originates consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, as well as sells residential mortgage loans in the secondary market. The Wealth Management segment provides trust, investment advisory, brokerage, and retirement planning services. The Insurance Operations segment offers a range of personal and corporate property and casualty insurance products. It also offers checking, saving, and individual retirement accounts; certificates of deposit; wire transfer; credit cards; home equity, mortgages, and small business; treasury management; and online and mobile banking, bill pay, digital wallet, mobile check deposit, credit score and report, money management, and estatements, as well as wealth advisory. German American Bancorp, Inc. was founded in 1910 and is based in Jasper, Indiana.

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 offers checking, savings, and money-market accounts; and accepts various deposit products, such as interest-bearing and non-interest-bearing accounts, time deposits, and cash management services for commercial customers. It also provides real estate loans secured by residential property, such as one to four family residential housing units or commercial property comprising owner-occupied and/or investor income producing real estate consisting of apartments, shopping centers, and office buildings; commercial and industrial loans for various purposes, including inventory, receivables, and equipment, as well as equipment and leasehold improvement financing for franchisees; 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 provides a range of trust and wealth management services; lease and equipment financing services; and currency payments, foreign exchange hedging, and other advisory products. First Financial Bancorp. was founded in 1863 and is headquartered in Cincinnati, Ohio.