Unity Bancorp (UNTY) & Its Peers Financial Analysis

Unity Bancorp (NASDAQ: UNTY) is one of 265 public companies in the “State commercial banks” industry, but how does it contrast to its peers? We will compare Unity Bancorp to related businesses based on the strength of its earnings, profitability, institutional ownership, risk, analyst recommendations, valuation and dividends.

Profitability

This table compares Unity Bancorp and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Unity Bancorp 28.43% 16.51% 1.44%
Unity Bancorp Competitors 22.70% 10.89% 1.20%

Earnings and Valuation

This table compares Unity Bancorp and its peers revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Unity Bancorp $76.29 million $21.92 million 10.60
Unity Bancorp Competitors $1.45 billion $275.37 million 8.23

Unity Bancorp’s peers have higher revenue and earnings than Unity Bancorp. Unity Bancorp is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Dividends

Unity Bancorp pays an annual dividend of $0.32 per share and has a dividend yield of 1.5%. Unity Bancorp pays out 15.9% of its earnings in the form of a dividend. As a group, “State commercial banks” companies pay a dividend yield of 2.4% and pay out 30.5% of their earnings in the form of a dividend. Unity Bancorp has raised its dividend for 5 consecutive years.

Institutional & Insider Ownership

48.7% of Unity Bancorp shares are owned by institutional investors. Comparatively, 47.9% of shares of all “State commercial banks” companies are owned by institutional investors. 29.7% of Unity Bancorp shares are owned by insiders. Comparatively, 11.0% of shares of all “State commercial banks” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and recommmendations for Unity Bancorp and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Unity Bancorp 0 0 1 0 3.00
Unity Bancorp Competitors 2672 7424 5433 328 2.22

Unity Bancorp presently has a consensus target price of $24.00, suggesting a potential upside of 12.62%. As a group, “State commercial banks” companies have a potential upside of 17.34%. Given Unity Bancorp’s peers higher probable upside, analysts clearly believe Unity Bancorp has less favorable growth aspects than its peers.

Volatility and Risk

Unity Bancorp has a beta of 0.66, indicating that its stock price is 34% less volatile than the S&P 500. Comparatively, Unity Bancorp’s peers have a beta of 0.75, indicating that their average stock price is 25% less volatile than the S&P 500.

Summary

Unity Bancorp beats its peers on 9 of the 15 factors compared.

Unity Bancorp Company Profile

Unity Bancorp, Inc. operates as the holding company for Unity Bank that provides a range of banking products and services to individuals, small and medium sized businesses, and professional communities. The company offers personal and business checking accounts, time deposits, money market accounts, and regular savings accounts. It also provides commercial, small business administration, consumer, mortgage, home equity, and personal loans. As of December 31, 2018, the company offered its financial services through 19 branch offices located in Bergen, Hunterdon, Middlesex, Somerset, Union, and Warren Counties in New Jersey, as well as Northampton County, Pennsylvania. Unity Bancorp, Inc. was founded in 1991 and is headquartered in Clinton, New Jersey.

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