Valley National Bancorp (NASDAQ:VLY) and Heartland BancCorp (OTCMKTS:HLAN) Critical Survey

Heartland BancCorp (OTCMKTS:HLAN) and Valley National Bancorp (NASDAQ:VLY) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, risk, valuation, institutional ownership, analyst recommendations and earnings.

Insider & Institutional Ownership

7.5% of Heartland BancCorp shares are held by institutional investors. Comparatively, 61.0% of Valley National Bancorp shares are held by institutional investors. 22.7% of Heartland BancCorp shares are held by company insiders. Comparatively, 1.9% of Valley National Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Heartland BancCorp and Valley National Bancorp’s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Heartland BancCorp	$104.83 million	1.70	$19.52 million	$9.94	8.86
Valley National Bancorp	$1.85 billion	1.93	$498.51 million	$0.85	8.21

Valley National Bancorp has higher revenue and earnings than Heartland BancCorp. Valley National Bancorp is trading at a lower price-to-earnings ratio than Heartland BancCorp, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Heartland BancCorp and Valley National Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Heartland BancCorp	18.24%	N/A	N/A
Valley National Bancorp	12.88%	7.74%	0.82%

Analyst Ratings

This is a summary of current recommendations and price targets for Heartland BancCorp and Valley National Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Heartland BancCorp	0	0	1	0	3.00
Valley National Bancorp	2	5	2	0	2.00

Heartland BancCorp currently has a consensus target price of $100.00, indicating a potential upside of 13.57%. Valley National Bancorp has a consensus target price of $8.67, indicating a potential upside of 24.16%. Given Valley National Bancorp’s higher possible upside, analysts plainly believe Valley National Bancorp is more favorable than Heartland BancCorp.

Dividends

Heartland BancCorp pays an annual dividend of $3.04 per share and has a dividend yield of 3.5%. Valley National Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 6.3%. Heartland BancCorp pays out 30.6% of its earnings in the form of a dividend. Valley National Bancorp pays out 51.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Risk & Volatility

Heartland BancCorp has a beta of 0.41, suggesting that its stock price is 59% less volatile than the S&P 500. Comparatively, Valley National Bancorp has a beta of 1.1, suggesting that its stock price is 10% more volatile than the S&P 500.

Summary

Valley National Bancorp beats Heartland BancCorp on 10 of the 16 factors compared between the two stocks.

About Heartland BancCorp

Heartland BancCorp operates as the bank holding company for Heartland Bank that provides various banking and financial services to individual and corporate customers. The company offers personal and business checking and savings accounts. It also provides various lending solutions comprising agricultural loans, commercial and business lending, home and personal loans, and title services. In addition, the company offers online banking, treasury management, credit and debit card, and mobile wallet services. Further, it provides education planning, insurance, wealth management, and retirement planning services. Heartland BancCorp was founded in 1911 and is based in Whitehall, Ohio.

About Valley National Bancorp

Valley National Bancorp operates as the holding company for Valley National Bank that provides various commercial, private banking, retail, insurance, and wealth management financial services products. It operates through Consumer Banking, Commercial Banking, and Treasury and Corporate other segments. The company offers non-interest bearing, savings, NOW, money market, and time deposit accounts; commercial and industrial, commercial real estate, residential mortgage, and automobile loans; loans secured by the cash surrender value of life insurance; home equity loans and lines of credit; automobile financing; and secured and unsecured other consumer loans. It also invests in various securities and interest-bearing deposits with other banks; and provides international banking services, such as standby and documentary letters of credit, and related products, as well as foreign exchange transactions, documentary collections, and foreign wire transfers services. In addition, the company offers investment services for individuals and small to medium sized businesses; and trusts investment strategies designed for various investment profiles and objectives. Further, it provides trust services, such as living and testamentary trusts, investment management, custodial and escrow services, and estate administration to individuals; tax credit advisory services; brokerage services; property and casualty, life, health, and title insurance agency services; and health care equipment lending and other commercial equipment leasing services, as well as owns real estate related investments. Additionally, the company offers online, mobile, and telephone banking services; receivable, payment, and security solution, merchant, payroll processing, and liquidity services; credit cards; and drive-in and night deposit, automated teller machine, remote deposit capture, and safe deposit facility services. Valley National Bancorp was founded in 1927 and is headquartered in Morristown, New Jersey.