Head to Head Contrast: MainStreet Bancshares (NASDAQ:MNSB) vs. 1st Source (NASDAQ:SRCE)


MainStreet Bancshares (NASDAQ: MNSB – Get Rating) and 1st Source (NASDAQ: SRCE – Get Rating) are both small cap finance companies, but which company is superior? We’ll compare the two companies based on their dividend strength, institutional ownership, profitability, valuation, analyst recommendations, risk and earnings.

Risk and Volatility

MainStreet Bancshares has a beta of 0.42, indicating that its stock price is 58% less volatile than the S&P 500. In comparison, 1st Source has a beta of 1.03, indicating that its stock price is 3% more volatile than the S&P 500.

Dividends

MainStreet Bancshares pays an annual dividend of $0.20 per share and has a dividend yield of 0.8%. 1st Source pays an annual dividend of $1.24 per share and has a dividend yield of 2.9%. MainStreet Bancshares pays 7.6% of its profits as a dividend. 1st Source pays 26.4% of its earnings as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings over the next few years. 1st Source has increased its dividend for 35 consecutive years. 1st Source is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares the net margins, return on equity and return on assets of MainStreet Bancshares and 1st Source.

Net margins Return on equity return on assets
MainStreet Bancshares 31.18% 14.12% 1.33%
1st Source 33.48% 12.43% 1.48%

Analyst Recommendations

This is a summary of recent recommendations and price targets for MainStreet Bancshares and 1st Source, as provided by MarketBeat.com.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
MainStreet Bancshares 0 0 1 0 3.00
1st Source 0 0 0 0 N / A

MainStreet Bancshares currently has a consensus price target of $26.00, indicating a potential upside of 7.13%. Given the likely higher upside of MainStreet Bancshares, stock analysts clearly believe that MainStreet Bancshares is more favorable than 1st Source.

Benefits and evaluation

This table compares the gross revenue, earnings per share and valuation of MainStreet Bancshares and 1st Source.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
MainStreet Bancshares $70.31 million 2.64 $22.17 million $2.63 9.23
1st Source $354.86 million 3.02 $118.53 million $4.69 9.23

1st Source has higher revenue and profit than MainStreet Bancshares. 1st Source trades at a lower price-to-earnings ratio than MainStreet Bancshares, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

41.9% of MainStreet Bancshares shares are held by institutional investors. By comparison, 73.0% of 1st Source’s shares are held by institutional investors. 7.8% of MainStreet Bancshares shares are held by insiders of the company. By comparison, 19.1% of 1st Source’s stock is held by company insiders. Strong institutional ownership indicates that large money managers, endowments, and hedge funds believe a company is poised for long-term growth.

Summary

1st Source beats MainStreet Bancshares on 11 out of 16 factors compared between the two stocks.

About MainStreet Bancshares (Get a rating)

MainStreet Bancshares, Inc. operates as a bank holding company for MainStreet Bank which provides various banking products and services to individuals, small and medium businesses and professional services organizations. The company offers current, NOW, money market, savings and sweep accounts, as well as certificates of deposit; business and consumer verification, interest-bearing verification, business account analysis and other filing services; and cash management, wire transfers, check imaging, remote deposit capture and courier services. It also provides commercial loans, including government contract receivables, plant and equipment, general working capital, contract administration and acquisition loans; commercial real estate, building construction and residential real estate loans; and consumer loans including term loans and overdraft protection, as well as debit and credit cards. In addition, the company offers deposit insurance solutions; remote check deposit; and Internet bill payment, online cash management, and online and mobile banking. As of March 18, 2022, it operated six branches in Herndon, Fairfax, McLean, Leesburg, Clarendon and Washington DC, as well as 55,000 ATMs. MainStreet Bancshares, Inc. was incorporated in 2003 and is headquartered in Fairfax, Virginia.

About 1st Source (Get a rating)

1st Source Corporation operates as a bank holding company for 1st Source Bank which provides corporate and personal banking services, trust and wealth management advisory services, and personal and commercial insurance products. Its consumer banking services include checking and savings accounts; certificates of deposit; individual retirement accounts; online and mobile banking products; consumer loans, home mortgages and home equity lines of credit; and financial planning, financial literacy and other advisory services, as well as debit and credit cards. The Company also offers commercial, small business, agricultural and real estate loans for general corporate purposes, including industrial and commercial property, equipment, inventory, accounts receivable and renewable energy financing. and acquisition; and commercial leasing, cash management and retirement planning services. In addition, it provides trust, investment, agency and custodial services comprising the administration of estates and personal trusts, as well as the management of investment accounts for individuals, employee benefit plans employees and charitable foundations. In addition, the Company offers equipment loan and rental products for construction equipment, new and used aircraft, automotive and light trucks, as well as medium and heavy trucks; and finances construction equipment, aircraft, medium and heavy trucks, vans, professional work trucks, coaches, shuttles, funeral cars, automobiles and other equipment. In addition, it offers property insurance, accident insurance, health insurance and individual and group life insurance products and services for businesses and individuals. As of December 31, 2021, the company operated through 79 banking centers in 18 counties in Indiana and Michigan, as well as Sarasota County in Florida. 1st Source Corporation was founded in 1863 and is headquartered in South Bend, Indiana.



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