Norwood Financial (NASDAQ:NWFL) & BayCom (NASDAQ:BCML) Financial Review

Norwood Financial (NASDAQ:NWFL) and BayCom (NASDAQ:BCML) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, earnings, risk, valuation, analyst recommendations, profitability and institutional ownership.

Volatility & Risk

Norwood Financial has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500. Comparatively, BayCom has a beta of 0.76, indicating that its stock price is 24% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Norwood Financial and BayCom, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Norwood Financial	0	0	0	0	0.00
BayCom	0	0	1	0	3.00

BayCom has a consensus target price of $28.00, indicating a potential downside of 3.41%. Given BayCom’s stronger consensus rating and higher possible upside, analysts plainly believe BayCom is more favorable than Norwood Financial.

Valuation & Earnings

This table compares Norwood Financial and BayCom”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Norwood Financial	$69.49 million	3.60	$16.76 million	$1.59	19.43
BayCom	$133.31 million	2.42	$27.42 million	$2.10	13.80

BayCom has higher revenue and earnings than Norwood Financial. BayCom is trading at a lower price-to-earnings ratio than Norwood Financial, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Norwood Financial and BayCom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Norwood Financial	10.90%	6.94%	0.57%
BayCom	17.22%	7.56%	0.93%

Dividends

Norwood Financial pays an annual dividend of $1.20 per share and has a dividend yield of 3.9%. BayCom pays an annual dividend of $0.40 per share and has a dividend yield of 1.4%. Norwood Financial pays out 75.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BayCom pays out 19.0% of its earnings in the form of a dividend.

Institutional and Insider Ownership

28.1% of Norwood Financial shares are owned by institutional investors. Comparatively, 66.2% of BayCom shares are owned by institutional investors. 9.1% of Norwood Financial shares are owned by insiders. Comparatively, 7.2% of BayCom shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

BayCom beats Norwood Financial on 12 of the 16 factors compared between the two stocks.

About Norwood Financial

Norwood Financial Corp. operates as the bank holding company for Wayne Bank that provides various banking products and services. The company accepts a range of deposit products, including interest-bearing and non-interest-bearing transaction accounts, and statement savings and money market accounts, as well as certificate of deposits. It also provides commercial loans comprising lines of credit, revolving credit, term loans, mortgages, secured lending products, and letter of credit facilities; municipal finance lending; construction loans for commercial construction projects and single-family residences; land loans; construction financing; consumer loans; mortgage lending to finance principal residences and second home dwellings; and indirect dealer financing of new and used automobiles, boats, and recreational vehicles. In addition, the company offers investment securities services; personal and business credit services; trust and investment products; and cash management, direct deposit, remote deposit capture, mobile deposit capture, automated clearing house activity, real estate settlement, and Internet and mobile banking services. Further, it engages in the annuity and mutual fund sale, and discount brokerage activities, as well as insurance agency business. The company serves consumers, businesses, nonprofit organizations, and municipalities. It operates branches in Northeastern Pennsylvania; and in Delaware, Sullivan, Ontario, Otsego, and Yates Counties, New York, as well as automated teller machines. Norwood Financial Corp. was founded in 1870 and is headquartered in Honesdale, Pennsylvania.

About BayCom

BayCom Corp operates as the bank holding company for United Business Bank that provides various financial services to small and mid-sized businesses, service professionals, and individuals. The company provides demand, savings, money market, and time deposit accounts. It offers commercial and multifamily real estate loans, including owner-occupied and investor real estate loans; commercial and industrial loans, such as equipment loans and working capital lines of credit; small business administration loans; construction and land loans; agriculture-related loans; and consumer loans comprising installment loans, unsecured and secured personal lines of credit, and overdraft protection. In addition, the company provides online and mobile banking, automated teller machine, remote deposit capture, night depository, courier, direct deposit, treasury management, wire transfer, automated clearing house, debit cards, cashier's and travelers checks, letters of credit, lockbox, positive pay, reverse positive pay, and account reconciliation services, as well as zero balance accounts and sweep accounts, including loan sweep. It operates through a network of full-service banking branches in Northern and Southern California; Las Vegas, Nevada; Denver, Colorado; Custer, Delta, and Grand counties, Colorado; and Seattle, Washington and Central New Mexico. The company was formerly known as Bay Commercial Bank and changed its name to BayCom Corp in January 2017. BayCom Corp was incorporated in 2004 and is headquartered in Walnut Creek, California.