Comparing Bank of the James Financial Group (NASDAQ:BOTJ) & Popular (NASDAQ:BPOP)

Bank of the James Financial Group (NASDAQ:BOTJ) and Popular (NASDAQ:BPOP) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, profitability, valuation, analyst recommendations, institutional ownership and risk.

Dividends

Bank of the James Financial Group pays an annual dividend of $0.40 per share and has a dividend yield of 1.7%. Popular pays an annual dividend of $3.00 per share and has a dividend yield of 2.1%. Bank of the James Financial Group pays out 16.5% of its earnings in the form of a dividend. Popular pays out 22.2% 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. Bank of the James Financial Group has increased its dividend for 5 consecutive years and Popular has increased its dividend for 6 consecutive years. Popular is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

18.5% of Bank of the James Financial Group shares are owned by institutional investors. Comparatively, 87.3% of Popular shares are owned by institutional investors. 11.9% of Bank of the James Financial Group shares are owned by company insiders. Comparatively, 2.1% of Popular shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Bank of the James Financial Group and Popular, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank of the James Financial Group	0	1	0	0	2.00
Popular	0	1	10	1	3.00

Popular has a consensus target price of $168.73, suggesting a potential upside of 16.49%. Given Popular’s stronger consensus rating and higher possible upside, analysts plainly believe Popular is more favorable than Bank of the James Financial Group.

Profitability

This table compares Bank of the James Financial Group and Popular’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank of the James Financial Group	17.17%	14.13%	1.06%
Popular	20.10%	14.53%	1.18%

Risk and Volatility

Bank of the James Financial Group has a beta of 0.18, suggesting that its share price is 82% less volatile than the S&P 500. Comparatively, Popular has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500.

Earnings & Valuation

This table compares Bank of the James Financial Group and Popular”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank of the James Financial Group	$62.51 million	1.67	$9.02 million	$2.42	9.48
Popular	$4.44 billion	2.10	$833.16 million	$13.54	10.70

Popular has higher revenue and earnings than Bank of the James Financial Group. Bank of the James Financial Group is trading at a lower price-to-earnings ratio than Popular, indicating that it is currently the more affordable of the two stocks.

Summary

Popular beats Bank of the James Financial Group on 16 of the 18 factors compared between the two stocks.

About Bank of the James Financial Group

Bank of the James Financial Group, Inc. operates as the bank holding company for Bank of the James that provides general retail and commercial banking services to individuals, businesses, associations and organizations, and governmental authorities in Virginia, the United States. It offers checking, savings, individual retirement, and health care saving accounts, as well as other time deposits, including money market accounts and certificates of deposit. The company also provides loans to small- and medium-sized businesses for the purchases of equipment, facilities upgrades, inventory acquisition, and various working capital purposes; commercial and residential construction and development loans; commercial real estate mortgage loans; residential mortgage loans; and secured and unsecured consumer loans, such as lines of credit and overdraft lines of credit, as well as personal, automobile, installment, demand, and home equity loans for personal, family, or household purposes. In addition, it offers other banking services, including safe deposit boxes, traveler's checks, direct deposit of payroll and social security checks, automatic drafts for various accounts, treasury management, and credit card merchant services. Further, the company provides mortgage banking; investment advisory services; securities brokerage and investment services; and telephone and internet banking services comprising online bill pay, as well as acts as an agent for insurance and annuity products. The company was founded in 1999 and is headquartered in Lynchburg, Virginia.

About Popular

Popular, Inc., through its subsidiaries, provides various retail, mortgage, and commercial banking products and services in Puerto Rico, the United States, and the British Virgin Islands. The company provides savings, NOW, money market, and other interest-bearing demand accounts; non-interest bearing demand deposits; and certificates of deposit. It also offers commercial and industrial, commercial multi-family, commercial real estate, and residential mortgage loans; consumer loans, including personal loans, credit cards, automobile loans, home equity lines of credit, and other loans to individual borrowers; construction loans; and lease financing comprising automobile loans/leases. In addition, the company provides investment banking, auto and equipment leasing and financing, broker-dealer, and insurance services; debit cards; and online banking services. Popular, Inc. was founded in 1893 and is headquartered in Hato Rey, Puerto Rico.