Critical Analysis: Washington Trust Bancorp (WASH) and Elmira Savings Bank (ESBK)

Washington Trust Bancorp (NASDAQ:WASH) and Elmira Savings Bank (NASDAQ:ESBK) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, analyst recommendations, risk, institutional ownership, dividends, valuation and earnings.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Washington Trust Bancorp and Elmira Savings Bank, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Washington Trust Bancorp 0 2 0 0 2.00
Elmira Savings Bank 0 0 0 0 N/A

Washington Trust Bancorp presently has a consensus price target of $54.00, indicating a potential upside of 16.53%. Given Washington Trust Bancorp’s higher possible upside, equities analysts plainly believe Washington Trust Bancorp is more favorable than Elmira Savings Bank.

Volatility & Risk

Washington Trust Bancorp has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500. Comparatively, Elmira Savings Bank has a beta of 0.43, suggesting that its share price is 57% less volatile than the S&P 500.

Insider and Institutional Ownership

58.3% of Washington Trust Bancorp shares are held by institutional investors. Comparatively, 17.2% of Elmira Savings Bank shares are held by institutional investors. 2.2% of Washington Trust Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Washington Trust Bancorp pays an annual dividend of $1.88 per share and has a dividend yield of 4.1%. Elmira Savings Bank pays an annual dividend of $0.92 per share and has a dividend yield of 5.1%. Washington Trust Bancorp has raised its dividend for 8 consecutive years and Elmira Savings Bank has raised its dividend for 2 consecutive years.

Valuation and Earnings

This table compares Washington Trust Bancorp and Elmira Savings Bank’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Washington Trust Bancorp $238.52 million 3.36 $68.43 million N/A N/A
Elmira Savings Bank $25.60 million 2.44 $4.24 million N/A N/A

Washington Trust Bancorp has higher revenue and earnings than Elmira Savings Bank.

Profitability

This table compares Washington Trust Bancorp and Elmira Savings Bank’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Washington Trust Bancorp 28.66% 15.98% 1.43%
Elmira Savings Bank 16.56% N/A N/A

Summary

Washington Trust Bancorp beats Elmira Savings Bank on 11 of the 13 factors compared between the two stocks.

Washington Trust Bancorp Company Profile

Washington Trust Bancorp, Inc. operates as the bank holding company for The Washington Trust Company, of Westerly that offers various financial products and services to individuals and businesses. The company operates in two segments, Commercial Banking and Wealth Management Services. The Commercial Banking segment provides various commercial and retail lending products, which include commercial real estate loans consisting of commercial mortgages and construction loans; commercial and industrial loans; residential real estate loans; and consumer loans comprising home equity loans and lines of credit, personal installment loans, and loans to individuals secured by general aviation aircraft. This segment also offers deposit accounts, including interest-bearing and noninterest-bearing demand deposits, NOW and savings accounts, money market and retirement deposit accounts, and time deposits, as well as debit card, ATM, telephone and Internet banking, mobile banking, remote deposit capture, and other cash management services. The Wealth Management Services segment provides investment management; financial planning; personal trust and estate services, such as trustee, personal representative, custodian, and guardian; and settlement of decedents' estates, as well as institutional trust services comprising custody and fiduciary services. This segment serves personal and institutional, and mutual funds clients. The company also operates as a licensed broker-dealer that offers variable annuities, college savings plans, and mutual funds. As of December 31, 2017, it had 10 branch offices located in southern Rhode Island; 11 branch offices located in the greater Providence area in Rhode Island; and 1 branch office located in southeastern Connecticut. Washington Trust Bancorp, Inc. was founded in 1800 and is headquartered in Westerly, Rhode Island.

Elmira Savings Bank Company Profile

Elmira Savings Bank provides banking products and services to individual and commercial customers. It accepts deposit products, such as savings and money market accounts, individual retirement arrangements, time deposits, retail and commercial checking accounts, NOW accounts, and certificates of deposit. The company also provides auto, truck, and motorcycle loans; personal loans; boats, recreational vehicles, and other outdoor sports equipment loans; home improvement/equity loans; jacuzzi/hot tub/pool loans; lines of credit; commercial real estate mortgages; commercial loans, including term and time loans, and small business administration loans; mortgage loans secured by first and second liens on one-to-four family residences; and merchant services. In addition, it offers financial planning advisory services; online, mobile, and telephone banking services; overdraft protection; safe deposit boxes; notary public services; and funds transfer services, as well as operates a real estate investment trust. The company operates through a network of 13 full-service offices located in Chemung, Tompkins, Cayuga, Schuyler, and Steuben Counties; and 1 limited service office located in Broome County, New York. Elmira Savings Bank was founded in 1869 and is based in Elmira, New York.

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