First Western Financial (NASDAQ:MYFW) and Midland States Bancorp (NASDAQ:MSBI) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, valuation, earnings and profitability.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for First Western Financial and Midland States Bancorp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Western Financial 0 1 0 0 2.00
Midland States Bancorp 0 1 0 0 2.00

First Western Financial presently has a consensus price target of $17.00, suggesting a potential upside of 1.66%. Given First Western Financial’s higher probable upside, research analysts plainly believe First Western Financial is more favorable than Midland States Bancorp.

Risk & Volatility

First Western Financial has a beta of 1.51, meaning that its stock price is 51% more volatile than the S&P 500. Comparatively, Midland States Bancorp has a beta of 1.37, meaning that its stock price is 37% more volatile than the S&P 500.

Insider and Institutional Ownership

40.6% of First Western Financial shares are held by institutional investors. Comparatively, 48.8% of Midland States Bancorp shares are held by institutional investors. 24.4% of First Western Financial shares are held by insiders. Comparatively, 12.7% of Midland States Bancorp shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares First Western Financial and Midland States Bancorp’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Western Financial $65.97 million 2.02 $5.65 million N/A N/A
Midland States Bancorp $324.80 million 1.97 $55.78 million $2.26 11.69

Midland States Bancorp has higher revenue and earnings than First Western Financial.

Profitability

This table compares First Western Financial and Midland States Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Western Financial 9.38% 7.50% 0.76%
Midland States Bancorp 17.16% 9.32% 1.03%

Summary

Midland States Bancorp beats First Western Financial on 6 of the 11 factors compared between the two stocks.

First Western Financial Company Profile

First Western Financial, Inc., a financial holding company, through its subsidiaries, provides an integrated suite of wealth management services comprising private banking, personal trust, investment management, mortgage loans, and institutional asset management services. It operates through three segments: Wealth Management, Capital Management, and Mortgage. The Wealth Management segment provides deposit, loan, insurance, and trust and investment management advisory products and services. The Capital Management offers institutional investment management services; and acts as advisor of proprietary mutual funds. The Mortgage segment engages in soliciting, originating, and selling mortgage loans into the secondary market. The company serves entrepreneurs, professionals, and high-net worth individuals and their related philanthropic and business organizations through a network of boutique private trust bank offices in Colorado, Arizona, Wyoming, and California. First Western Financial, Inc. was founded in 2002 and is headquartered in Denver, Colorado.

Midland States Bancorp Company Profile

Midland States Bancorp, Inc. operates as a financial holding company for Midland States Bank that provides various banking products and services to individuals, businesses, municipalities, and other entities. It operates through Banking, Commercial FHA Origination and Servicing, Wealth Management, and Other segments. The company accepts various deposits, such as checking, savings, money market, and sweep accounts, as well as certificates of deposit, noninterest-bearing and interest-bearing demand deposits, and time deposits. Its loan portfolio include commercial lending products consisting of owner occupied commercial real estate, commercial real estate investment, real estate construction, and multifamily loans, as well as loans to purchase farmland and finance agricultural production; business term loans, equipment financing, and lines of credit; consumer installment loans for purchase cars, boats, other recreational vehicles, and appliances, as well as other home improvement projects; and residential first and second mortgage loans, and home equity lines of credit. The company also originates residential mortgage loans; and commercial mortgage loans for multifamily and healthcare facilities. In addition, it provides trust and wealth management products and services, including financial and estate planning, trustee and custodial services, investment management, tax and insurance planning, business planning, corporate retirement plan consulting and administration, and retail brokerage services. Further, the company offers commercial equipment leasing and merchant services. As of December 31, 2018, it operated 69 banking offices in 48 communities within its market areas, such as Illinois and the St. Louis metropolitan areas. The company was founded in 1881 and is headquartered in Effingham, Illinois.

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