Contrasting Farmers & Merchants Bancorp (OTCMKTS:FMCB) & First Bancorp (NASDAQ:FNLC)

Profitability

This table compares Farmers & Merchants Bancorp and First Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Farmers & Merchants Bancorp	30.25%	15.35%	1.62%
First Bancorp	16.46%	10.72%	0.87%

Institutional & Insider Ownership

5.6% of Farmers & Merchants Bancorp shares are owned by institutional investors. Comparatively, 40.4% of First Bancorp shares are owned by institutional investors. 8.0% of Farmers & Merchants Bancorp shares are owned by insiders. Comparatively, 6.0% of First Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Volatility & Risk

Farmers & Merchants Bancorp has a beta of 0.22, indicating that its share price is 78% less volatile than the S&P 500. Comparatively, First Bancorp has a beta of 0.58, indicating that its share price is 42% less volatile than the S&P 500.

Dividends

Farmers & Merchants Bancorp pays an annual dividend of $18.60 per share and has a dividend yield of 1.8%. First Bancorp pays an annual dividend of $1.44 per share and has a dividend yield of 5.6%. Farmers & Merchants Bancorp pays out 15.7% of its earnings in the form of a dividend. First Bancorp pays out 60.8% 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.

Valuation and Earnings

This table compares Farmers & Merchants Bancorp and First Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Farmers & Merchants Bancorp	$268.67 million	2.72	$88.31 million	$118.46	8.82
First Bancorp	$143.61 million	2.00	$29.52 million	$2.37	10.86

Farmers & Merchants Bancorp has higher revenue and earnings than First Bancorp. Farmers & Merchants Bancorp is trading at a lower price-to-earnings ratio than First Bancorp, indicating that it is currently the more affordable of the two stocks.

Summary

Farmers & Merchants Bancorp beats First Bancorp on 9 of the 13 factors compared between the two stocks.

About Farmers & Merchants Bancorp

Farmers & Merchants Bancorp operates as the bank holding company for Farmers & Merchants Bank of Central California that provides various banking services to businesses and individuals. The company accepts various deposit products, including checking, savings, money market, time certificates of deposit, and individual retirement accounts. It also offers range of lending products comprising commercial and residential real estate, real estate construction, agribusiness, and consumer loans, as well as equipment leases and credit card services; commercial products, including term loans, lines of credit and other working capital financing, and letters of credit; and financing products, such as automobile financing, home improvement, and home equity lines of credit. In addition, the company provides various specialized services consisting of credit card programs for merchants, lockbox and other collection services, account reconciliation, investment sweep, online account access, and electronic funds transfers through domestic and international wire and automated clearinghouse; online banking services; and investment products, such as mutual funds and annuities. The company was founded in 1916 and is headquartered in Lodi, California.

About First Bancorp

The First Bancorp, Inc. operates as the holding company for First National Bank that provides a range of banking products and services to individuals and businesses. It offers various deposit products, including demand, NOW, time, savings, money market, and certificates of deposit accounts. The company also provides commercial loans comprising commercial real estate owner occupied, such as mortgage loans to finance investments in real property such as retail space, offices, industrial buildings, hotels, educational facilities, and other specific or mixed use properties; commercial real estate non-owner occupied loans; commercial construction to finance construction in a mix of owner- and nonowner occupied commercial real estate properties; and commercial and industrial loans, including revolving and term loan for financing working capital and/or capital investment. In addition, it offers commercial multifamily loans; residential real estate term and residential real estate construction loans; loans to municipalities in Maine for capitalized expenditures, construction projects, or tax anticipation notes; home equity revolving and term loans; and personal lines of credit and amortizing loans for various purposes, such as autos, recreational vehicles, debt consolidation, personal expenses, or overdraft protection. Further, the company offers private banking, financial planning, investment management, and trust services to individuals, businesses, non-profit organizations and municipalities; and brokerage, annuity, and various insurance products, as well as payment processing services. It operates through full-service banking offices in Lincoln, Knox, Waldo, Penobscot, Hancock, and Washington counties in the Mid-Coast, Eastern, and Down East regions of Maine. The company was formerly known as First National Lincoln Corporation and changed its name to The First Bancorp, Inc. in April 2008. The First Bancorp, Inc. was founded in 1864 and is based in Damariscotta, Maine.