Lakeland Bancorp (NASDAQ:LBAI) versus Independent Bank (NASDAQ:IBCP) Critical Survey

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Lakeland Bancorp (NASDAQ: LBAIGet a rating) and independent bank (NASDAQ: IBCPGet a rating) are both small cap finance companies, but which is the better investment? We’ll compare the two companies based on profitability strength, risk, institutional ownership, valuation, dividends, earnings, and analyst recommendations.

Insider and Institutional Ownership

49.3% of Lakeland Bancorp shares are held by institutional investors. Comparatively, 79.6% of Independent Bank’s shares are held by institutional investors. 4.7% of Lakeland Bancorp shares are held by insiders. By comparison, 5.2% of Independent Bank’s shares are held by insiders. Strong institutional ownership indicates that hedge funds, large money managers, and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Lakeland Bancorp and Independent Bank, as reported by MarketBeat.com.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
Lakeland Bancorp 0 0 0 0 N / A
Independent bank 0 1 0 0 2.00

Independent Bank has a consensus price target of $20.00, indicating a potential upside of 3.73%. Given Independent Bank’s likely higher upside, analysts clearly believe Independent Bank is more favorable than Lakeland Bancorp.

Benefits and evaluation

This table compares the gross revenue, earnings per share and valuation of Lakeland Bancorp and Independent Bank.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
Lakeland Bancorp $279.68 million 3.39 $95.04 million $1.64 8.91
Independent bank $214.72 million 1.89 $62.90 million $2.71 7.11

Lakeland Bancorp has higher revenue and profit than Independent Bank. Independent Bank is trading at a lower price-to-earnings ratio than Lakeland Bancorp, indicating that it is currently the more affordable of the two stocks.

Volatility and risk

Lakeland Bancorp has a beta of 0.87, which means its stock price is 13% less volatile than the S&P 500. Comparatively, Independent Bank has a beta of 1, which means its stock price has a volatility profile similar to that of the S&P 500.

Dividends

Lakeland Bancorp pays an annual dividend of $0.58 per share and has a dividend yield of 4.0%. Independent Bank pays an annual dividend of $0.88 per share and has a dividend yield of 4.6%. Lakeland Bancorp pays 35.4% of its profits as a dividend. Independent Bank pays 32.5% of its profits 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. Lakeland Bancorp has increased its dividend for 13 consecutive years and Independent Bank has increased its dividend for 8 consecutive years. Independent Bank is clearly the best dividend-paying stock, given its higher yield and lower payout ratio.

Profitability

This table compares the net margins, return on equity and return on assets of Lakeland Bancorp and Independent Bank.

Net margins Return on equity return on assets
Lakeland Bancorp 29.93% 11.24% 1.13%
Independent bank 28.08% 15.18% 1.27%

Summary

Independent Bank beats Lakeland Bancorp on 9 out of 15 factors compared between the two stocks.

Lakeland Bancorp Company Profile (Get a rating)

Lakeland Bancorp, Inc. operates as a bank holding company for Lakeland Bank which offers various banking products and services to individuals and small and medium businesses. The Company provides commercial banking services, including savings, money market and term accounts, as well as demand deposits. It is also involved in lending services, including commercial real estate loans, commercial and industrial loans, short and medium term loans, lines of credit, letters of credit, inventory and accounts receivable financing, home construction loans, residential mortgages, small business loans administration (SBA) and merchant credit card services; financing solutions for small and medium-sized enterprises; online banking, mobile banking and wire transfer services; and cash management services, such as remote deposit capture and overnight repurchase agreements. In addition, it provides consumer banking services, which include checking accounts, savings accounts, interest-bearing checking accounts, money market accounts, certificates of deposit, online banking, secured loans and unsecured, consumer installment loans, mortgages and safe deposit services. . In addition, the company offers investment advisory services for individuals and businesses; and securities brokerage services, including mutual funds and variable annuities, as well as commercial title insurance services and life insurance products. As of December 31, 2021, it operated 48 branches located in Bergen, Essex, Morris, Ocean, Passaic, Somerset, Sussex, and Union counties in New Jersey and Highland Mills, New York; operated six regional New Jersey commercial lending centers in Bernardsville, Iselin, Jackson, Montville, Teaneck and Waldwick; and a commercial lending center in New York to serve the Hudson Valley region. The company was incorporated in 1969 and is based in Oak Ridge, New Jersey.

Profile of the independent bank (Get a rating)

Independent Bank LogoIndependent Bank Corporation operates as a bank holding company for Independent Bank which provides various retail and corporate banking services. The company offers checking and savings accounts, business loans, direct and indirect consumer financing, mortgages and safe deposit services, as well as automated teller machines and internet and mobile banking. It also provides title insurance, insurance brokerage and investment services. The company offers its services through approximately 59 branches, two drive-thru facilities, and seven loan origination offices in Michigan; and two loan origination offices in Ohio. Independent Bank Corporation was founded in 1864 and is based in Grand Rapids, Michigan.



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