Critical Analysis: Bridgewater Bancshares (NASDAQ:BWB) & First Bank (NASDAQ:FRBA)

First Bank (NASDAQ:FRBA) and Bridgewater Bancshares (NASDAQ:BWB) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, dividends, risk, analyst recommendations and earnings.

Institutional and Insider Ownership

64.9% of First Bank shares are owned by institutional investors. Comparatively, 65.8% of Bridgewater Bancshares shares are owned by institutional investors. 23.1% of Bridgewater Bancshares shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

First Bank has a beta of 0.53, meaning that its stock price is 47% less volatile than the S&P 500. Comparatively, Bridgewater Bancshares has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for First Bank and Bridgewater Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Bank	0	1	3	1	3.00
Bridgewater Bancshares	0	0	4	0	3.00

First Bank presently has a consensus price target of $19.67, suggesting a potential downside of 0.60%. Bridgewater Bancshares has a consensus price target of $23.67, suggesting a potential upside of 15.10%. Given Bridgewater Bancshares’ higher possible upside, analysts plainly believe Bridgewater Bancshares is more favorable than First Bank.

Valuation and Earnings

This table compares First Bank and Bridgewater Bancshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Bank	$245.83 million	2.02	$43.66 million	$1.71	11.57
Bridgewater Bancshares	$168.27 million	3.41	$46.09 million	$1.95	10.54

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

Profitability

This table compares First Bank and Bridgewater Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Bank	17.73%	9.58%	1.07%
Bridgewater Bancshares	19.27%	11.60%	1.00%

Summary

Bridgewater Bancshares beats First Bank on 10 of the 14 factors compared between the two stocks.

About First Bank

First Bank provides various banking products and services to small to mid-sized businesses and individuals. The company accepts various deposits, including non-interest-bearing demand deposits, interest bearing demand accounts, money market accounts, savings accounts, and certificates of deposit, as well as commercial checking accounts. It also offers various loan products comprising commercial and industrial loans, which include line of credit, inventory, equipment, and short-term working capital financing; commercial real estate loans, such as owner-occupied, investor, construction and development, and multi-family loans; residential real estate loans comprising residential mortgages, first and second lien home equity loans, and revolving lines of credit; and consumer and other loans consists of auto, personal, traditional installment, and other loans. The company also provides electronic banking services, including Internet and mobile banking, electronic bill payment, and banking by phone; ATM and debit cards, and wire and ACH transfer services; remote deposit capture; and cash management services, as well as engages in the capital markets activities. It operates full-service branches in Cinnaminson, Delanco, Denville, Ewing, Fairfield, Flemington, Hamilton, Lawrence, Monroe, Pennington, Randolph, Somerset, and Williamstown, New Jersey; Doylestown, Trevose, Warminster, and West Chester, Paoli, Malvern, Coventry, Devon, Lionville, and Glen Mills Pennsylvania; and Palm Beach, Florida. First Bank was incorporated in 2007 and is headquartered in Hamilton, New Jersey.

About Bridgewater Bancshares

Bridgewater Bancshares, Inc. operates as the bank holding company for Bridgewater Bank that provides banking products and services to commercial real estate investors, entrepreneurs, business clients, and individuals in the United States. The company provides savings and money market accounts, demand deposits, time and brokered deposits, and interest and noninterest bearing transaction, as well as certificates of deposit. It offers commercial loans to sole proprietorships, partnerships, corporations, and other business enterprises to finance working capital, capital investment, or for other business related purposes; paycheck protection program loans; construction and land development loans; 1-4 family mortgage loans; multifamily lending products; owner and non-owner occupied commercial real estate loans; and consumer and other loans. In addition, the company online, mobile, and direct banking services. Bridgewater Bancshares, Inc. was incorporated in 2005 and is headquartered in Saint Louis Park, Minnesota.