Head to Head Comparison: German American Bancorp (NASDAQ:GABC) versus Chemung Financial (NASDAQ:CHMG)

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

Volatility & Risk

German American Bancorp has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500. Comparatively, Chemung Financial has a beta of 0.19, meaning that its stock price is 81% less volatile than the S&P 500.

Institutional and Insider Ownership

46.9% of German American Bancorp shares are held by institutional investors. Comparatively, 47.5% of Chemung Financial shares are held by institutional investors. 6.2% of German American Bancorp shares are held by insiders. Comparatively, 12.0% of Chemung Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

German American Bancorp pays an annual dividend of $1.08 per share and has a dividend yield of 2.8%. Chemung Financial pays an annual dividend of $1.24 per share and has a dividend yield of 2.7%. German American Bancorp pays out 39.0% of its earnings in the form of a dividend. Chemung Financial pays out 27.4% 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 increased its dividend for 12 consecutive years. German American Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
German American Bancorp	23.75%	11.94%	1.33%
Chemung Financial	14.56%	10.60%	0.78%

Analyst Recommendations

This is a summary of recent recommendations and price targets for German American Bancorp and Chemung Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
German American Bancorp	0	2	3	0	2.60
Chemung Financial	0	2	0	0	2.00

German American Bancorp presently has a consensus price target of $45.40, indicating a potential upside of 15.73%. Chemung Financial has a consensus price target of $58.50, indicating a potential upside of 25.64%. Given Chemung Financial’s higher possible upside, analysts plainly believe Chemung Financial is more favorable than German American Bancorp.

Earnings & Valuation

This table compares German American Bancorp and Chemung Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
German American Bancorp	$316.92 million	3.67	$85.89 million	$2.77	14.16
Chemung Financial	$94.12 million	2.35	$25.00 million	$4.52	10.30

German American Bancorp has higher revenue and earnings than Chemung Financial. Chemung Financial 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.

Summary

German American Bancorp beats Chemung Financial on 12 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 Chemung Financial

Chemung Financial Corporation operates as a bank holding company for Chemung Canal Trust Company that provides a range of banking, financing, fiduciary, and other financial services. The company provides demand, savings, and time deposits; non-interest and interest-bearing checking accounts; and insured money market accounts. It also offers commercial and agricultural loans comprising loans to small to mid-sized businesses; commercial and residential mortgage loans; and consumer loans, including home equity lines of credit and home equity term loans. In addition, the company provides interest rate swaps, letters of credit, employee benefit plans, insurance products, mutual fund, brokerage, and tax preparation services. Further, it offers guardian, custodian, trustee, investment, pension, estate planning, and employee benefit administrative services, as well as acts as an agent for pension, profit-sharing, and other employee benefit trusts. Chemung Financial Corporation was founded in 1833 and is headquartered in Elmira, New York.