Comparing First National (NASDAQ:FXNC) and Avidia Bancorp (NYSE:AVBC)

Avidia Bancorp (NYSE:AVBC) and First National (NASDAQ:FXNC) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, profitability, institutional ownership, analyst recommendations, risk, earnings and dividends.

Dividends

Avidia Bancorp pays an annual dividend of $0.24 per share and has a dividend yield of 1.1%. First National pays an annual dividend of $0.68 per share and has a dividend yield of 2.2%. Avidia Bancorp pays out 25.3% of its earnings in the form of a dividend. First National pays out 28.3% 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 National has increased its dividend for 10 consecutive years. First National is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

33.9% of First National shares are held by institutional investors. 3.4% of Avidia Bancorp shares are held by insiders. Comparatively, 14.2% of First National shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Avidia Bancorp	11.51%	4.62%	0.63%
First National	18.43%	11.50%	1.05%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Avidia Bancorp and First National, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Avidia Bancorp	1	0	0	1	2.50
First National	0	1	1	0	2.50

Valuation and Earnings

This table compares Avidia Bancorp and First National”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Avidia Bancorp	$147.61 million	2.98	-$3.29 million	$0.95	23.18
First National	$116.51 million	2.39	$17.70 million	$2.40	12.84

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

Summary

First National beats Avidia Bancorp on 10 of the 15 factors compared between the two stocks.

About Avidia Bancorp

Avidia Bancorp Inc. is a chartered stock savings bank. It operates full-service banking offices principally in western Middlesex County and eastern Worcester County, in Massachusetts. Avidia Bancorp Inc. is based in HUDSON, Mass.

About First National

First National Corporation operates as the bank holding company for First Bank that provides various commercial banking services to small and medium-sized businesses, individuals, estates, local governmental entities, and non-profit organizations in Virginia. The company's deposit products include checking, savings, money market, and individual retirement accounts, as well as certificates of deposit and treasury management solutions. Its loan products comprise construction loans, including residential, land acquisition, and development loans; 1-4 family residential real estate loans; and commercial real estate loans that are secured by commercial real estate, including multi-family residential buildings, office and retail buildings, hotels, industrial buildings, and religious facilities. In addition, the company's loan products include commercial and industrial loans that are secured by business assets, such as accounts receivable, equipment, and inventory; home equity loans; and secured and unsecured consumer loans, such as lines of credit, automobile loans, deposit account loans, and installment and demand loans. Further, it provides wealth management services, including estate planning, investment management of assets, trustee under an agreement, trustee under a will, and estate settlement. Additionally, the company offers title insurance and investment services; and holds other real estate owned and office sites, as well as provides internet and mobile banking, remote deposit capture, and other traditional banking services. First National Corporation was founded in 1907 and is headquartered in Strasburg, Virginia.