National Bankshares (NASDAQ:NKSH – Get Free Report) and Meridian (NASDAQ:MRBK – Get Free Report) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, institutional ownership, profitability, risk and dividends.
Institutional & Insider Ownership
29.7% of National Bankshares shares are owned by institutional investors. Comparatively, 58.6% of Meridian shares are owned by institutional investors. 2.8% of National Bankshares shares are owned by company insiders. Comparatively, 14.0% of Meridian shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of recent ratings and price targets for National Bankshares and Meridian, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| National Bankshares | 0 | 0 | 1 | 0 | 3.00 |
| Meridian | 0 | 1 | 1 | 0 | 2.50 |
Risk and Volatility
National Bankshares has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, Meridian has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500.
Dividends
National Bankshares pays an annual dividend of $1.56 per share and has a dividend yield of 5.3%. Meridian pays an annual dividend of $0.50 per share and has a dividend yield of 3.1%. National Bankshares pays out 107.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Meridian pays out 49.5% of its earnings in the form of a dividend.
Earnings & Valuation
This table compares National Bankshares and Meridian”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| National Bankshares | $68.19 million | 2.74 | $15.69 million | $1.45 | 20.23 |
| Meridian | $168.55 million | 1.06 | $13.24 million | $1.01 | 15.74 |
National Bankshares has higher earnings, but lower revenue than Meridian. Meridian is trading at a lower price-to-earnings ratio than National Bankshares, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares National Bankshares and Meridian’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| National Bankshares | 11.44% | 5.85% | 0.50% |
| Meridian | 6.00% | 6.99% | 0.49% |
Summary
National Bankshares beats Meridian on 9 of the 15 factors compared between the two stocks.
About National Bankshares
National Bankshares, Inc. operates as the bank holding company for the National Bank of Blacksburg that provides retail and commercial banking products and services to individuals, businesses, non-profits, and local governments. The company accepts interest-bearing and non-interest-bearing demand deposit accounts, money market deposit accounts, savings accounts, certificates of deposit, health savings accounts, and individual retirement accounts. Its loan products include commercial and agricultural, commercial real estate, residential real estate, home equity, and various consumer loan products, as well as loans for the construction of commercial and residential properties. The company also provides business and consumer debit and credit cards; letters of credit, night depository services, safe deposit boxes, utility payment services, and automatic funds transfer; wealth management, trust, and estate services; non-deposit investment and insurance products; and telephone, mobile, and Internet banking services. The company was founded in 1891 and is headquartered in Blacksburg, Virginia.
About Meridian
Meridian Corporation operates as the holding company for Meridian Bank that provides commercial banking products and services in Pennsylvania, New Jersey, Delaware, Florida, and Maryland. The company offers various deposit products, such as demand non-interest bearing, demand interest bearing, savings accounts, money market accounts, and time deposits. It also provides commercial and industrial loans comprising business lines of credit, term loans, small business lending, lease financing, shared national credits, and other financing; commercial real estate, and land development and construction loans for residential and commercial projects; and consumer and home equity lending, private banking, merchant, and title and land settlement services. In addition, the company operates and originates mortgage loans for 1-4 family dwellings; and offers real estate holding, investment advisory, and equipment leasing services, as well as financial planning and wealth management services. Meridian Corporation was incorporated in 2004 and is headquartered in Malvern, Pennsylvania.
Receive News & Ratings for National Bankshares Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for National Bankshares and related companies with MarketBeat.com's FREE daily email newsletter.
