Commercial National Financial (OTCMKTS:CEFC) versus Old Second Bancorp (NASDAQ:OSBC) Financial Contrast

Old Second Bancorp (NASDAQ:OSBC) and Commercial National Financial (OTCMKTS:CEFC) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, dividends, institutional ownership, risk, profitability and valuation.

Earnings and Valuation

This table compares Old Second Bancorp and Commercial National Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Old Second Bancorp	$326.15 million	2.51	$91.73 million	$1.85	9.86
Commercial National Financial	$27.39 million	1.45	$6.17 million	$1.38	7.24

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

Risk and Volatility

Old Second Bancorp has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500. Comparatively, Commercial National Financial has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Old Second Bancorp and Commercial National Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Old Second Bancorp	0	1	3	0	2.75
Commercial National Financial	0	0	0	0	0.00

Old Second Bancorp currently has a consensus target price of $18.88, indicating a potential upside of 3.48%. Given Old Second Bancorp’s stronger consensus rating and higher probable upside, research analysts plainly believe Old Second Bancorp is more favorable than Commercial National Financial.

Dividends

Old Second Bancorp pays an annual dividend of $0.24 per share and has a dividend yield of 1.3%. Commercial National Financial pays an annual dividend of $0.56 per share and has a dividend yield of 5.6%. Old Second Bancorp pays out 13.0% of its earnings in the form of a dividend. Commercial National Financial pays out 40.6% 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.

Institutional and Insider Ownership

67.8% of Old Second Bancorp shares are held by institutional investors. 3.8% of Old Second Bancorp shares are held by company insiders. Comparatively, 23.0% of Commercial National Financial shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Old Second Bancorp and Commercial National Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Old Second Bancorp	25.02%	13.81%	1.49%
Commercial National Financial	18.88%	N/A	N/A

Summary

Old Second Bancorp beats Commercial National Financial on 14 of the 16 factors compared between the two stocks.

About Old Second Bancorp

Old Second Bancorp, Inc. operates as the bank holding company for Old Second National Bank that provides community banking services. It offers demand, NOW, money market, savings, time deposit, individual retirement, and checking accounts, as well as certificates of deposit accounts. The company also provides commercial loans; lease financing receivables; commercial real estate loans; construction loans; residential real estate loans, such as residential first mortgage and second mortgage loans; home equity line of credit; consumer loans, including motor vehicle, home improvement, and signature loans; installment and agricultural loans; residential mortgages; and overdraft checking. In addition, it offers safe deposit services; trust and wealth management services; and money orders, cashier’s checks, foreign currency, direct deposits, discount brokerage, debit and credit cards, and other services, as well as acquires the U.S. treasury notes and bonds. Further, the company provides online and mobile banking; corporate cash management products, including remote and mobile deposits capture, investment sweep accounts, zero balance accounts, automated tax payments, automatic teller machines access, telephone banking, lockbox accounts, automated clearing house transactions, account reconciliation, controlled disbursement, detail and general information reporting, foreign and domestic wire transfers, and vault services for currency and coin; and investment, agency, and custodial services for individual, corporate, and not-for-profit clients. Old Second Bancorp, Inc. was incorporated in 1981 and is headquartered in Aurora, Illinois.

About Commercial National Financial

Commercial National Financial Corporation operates as the holding company for Commercial Bank that provides various banking products and services to individuals, agricultural businesses, commercial businesses, and light industries in Michigan. The company accepts various deposit products, including checking and savings accounts, individual retirement accounts, certificates of deposit, and health savings accounts. It also offers personal loan products, such as automobile loans, recreational vehicle loans, personal lines of credit, and unsecured term loans, as well as home equity loans and mortgage loans; and business loans, including secured lines of credit, business equity line of credit, SBA loans, equipment loans, real estate loans, vehicle loans, term loans, USDA loan programs, and capital access loan programs. In addition, the company provides other services comprising business VISA check cards, debit and ATM cards, business statement savings, business certificates of deposit, merchant services, night depository, telephone banking, online banking, e-statements, direct deposit of payroll for employees, child support payments, collection of receivables, and remote deposit capture, as well as treasury services. It provides its services through offices located in Barry, Gratiot, Ingham, Kent, and Montcalm counties in Michigan. The company was founded in 1893 and is headquartered in Ithaca, Michigan.