Business First Bancshares (NASDAQ:BFST) vs. First Internet Bancorp (NASDAQ:INBK) Head-To-Head Survey

First Internet Bancorp (NASDAQ:INBK) and Business First Bancshares (NASDAQ:BFST) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, earnings, valuation, institutional ownership, risk, profitability and analyst recommendations.

Profitability

This table compares First Internet Bancorp and Business First Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Internet Bancorp	-9.35%	-2.05%	-0.13%
Business First Bancshares	15.94%	11.08%	1.08%

Dividends

First Internet Bancorp pays an annual dividend of $0.24 per share and has a dividend yield of 1.2%. Business First Bancshares pays an annual dividend of $0.60 per share and has a dividend yield of 2.2%. First Internet Bancorp pays out -6.3% of its earnings in the form of a dividend. Business First Bancshares pays out 23.2% 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. Business First Bancshares has increased its dividend for 2 consecutive years. Business First Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for First Internet Bancorp and Business First Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Internet Bancorp	2	2	1	0	1.80
Business First Bancshares	0	1	4	0	2.80

First Internet Bancorp presently has a consensus price target of $24.33, suggesting a potential upside of 20.82%. Business First Bancshares has a consensus price target of $30.75, suggesting a potential upside of 14.40%. Given First Internet Bancorp’s higher possible upside, equities research analysts clearly believe First Internet Bancorp is more favorable than Business First Bancshares.

Insider and Institutional Ownership

65.5% of First Internet Bancorp shares are held by institutional investors. Comparatively, 47.4% of Business First Bancshares shares are held by institutional investors. 8.0% of First Internet Bancorp shares are held by company insiders. Comparatively, 5.7% of Business First Bancshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Risk and Volatility

First Internet Bancorp has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500. Comparatively, Business First Bancshares has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.

Valuation and Earnings

This table compares First Internet Bancorp and Business First Bancshares”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Internet Bancorp	$339.23 million	0.52	$25.28 million	($3.80)	-5.30
Business First Bancshares	$458.96 million	1.73	$65.11 million	$2.59	10.38

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

Summary

Business First Bancshares beats First Internet Bancorp on 13 of the 17 factors compared between the two stocks.

About First Internet Bancorp

First Internet Bancorp operates as the bank holding company for First Internet Bank of Indiana that provides commercial, small business, consumer, and municipal banking products and services to individuals and commercial customers in the United States. The company accepts non-interest bearing and interest-bearing demand deposit, commercial deposit, savings, money market, and Banking-as-a-Service brokered deposit accounts, as well as certificates of deposit. It also offers commercial and industrial, owner-occupied and investor commercial real estate, construction, residential mortgage, home equity, line of credit and home improvement, small installment, term, and other consumer loans, as well as single tenant lease financing, and public and healthcare finance; franchise finance; and small business lending. In addition, the company is involved in the purchase, manage, service, and safekeeping of municipal securities; and provision of public and municipal lending and leasing products to government entities. Further, the company offers corporate credit card and treasury management services. First Internet Bancorp was founded in 1998 and is headquartered in Fishers, Indiana.

About Business First Bancshares

Business First Bancshares, Inc. operates as the bank holding company for b1BANK that provides various banking products and services in Louisiana and Texas. It offers various deposit products and services, including checking, demand, money market, time, and savings accounts; and certificates of deposits, remote deposit capture, and direct deposit services. The company also provides commercial and industrial loans, such as working capital, term, equipment financing, asset acquisition, expansion and development, borrowing base, and other loan products, as well as commercial lines of credit, accounts receivable factoring, agricultural financing, and letters of credit; construction and development loans; commercial real estate loans; residential real estate loans comprising first and second lien 1-4 family mortgage loans, and home equity lines of credit; and consumer loans, including secured and unsecured installment, and term loans. In addition, it offers wealth management products, including mutual funds, annuities, individual retirement accounts, and other financial products, as well as other fiduciary and private banking products and services. Further, the company provides a range of other financial services comprising debit and credit cards, treasury and cash management, merchant, automated clearing house, lock-box, receivables factoring, correspondent banking, and other treasury services, as well as employee and payroll benefits solutions; and drive-through banking facilities, automated teller machines, night depository, personalized checks, electronic funds transfer, domestic and foreign wire transfer, traveler's checks, vault, loan and deposit sweep accounts, online and mobile banking, e-statements, and bank-by-mail services. Business First Bancshares, Inc. was founded in 2006 and is headquartered in Baton Rouge, Louisiana.