BankFinancial (BFIN) & First Guaranty Bancshares (FGBI) Critical Analysis

First Guaranty Bancshares (NASDAQ:FGBI) and BankFinancial (NASDAQ:BFIN) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, dividends, risk and earnings.

Dividends

First Guaranty Bancshares pays an annual dividend of $0.64 per share and has a dividend yield of 2.9%. BankFinancial pays an annual dividend of $0.40 per share and has a dividend yield of 2.6%. BankFinancial pays out 46.5% of its earnings in the form of a dividend. First Guaranty Bancshares has raised its dividend for 3 consecutive years and BankFinancial has raised its dividend for 5 consecutive years.

Insider and Institutional Ownership

11.4% of First Guaranty Bancshares shares are held by institutional investors. Comparatively, 66.5% of BankFinancial shares are held by institutional investors. 39.6% of First Guaranty Bancshares shares are held by company insiders. Comparatively, 15.2% of BankFinancial shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares First Guaranty Bancshares and BankFinancial’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Guaranty Bancshares $75.89 million 2.57 $11.75 million N/A N/A
BankFinancial $76.16 million 3.31 $19.34 million $0.86 17.81

BankFinancial has higher revenue and earnings than First Guaranty Bancshares.

Volatility & Risk

First Guaranty Bancshares has a beta of 0.35, suggesting that its stock price is 65% less volatile than the S&P 500. Comparatively, BankFinancial has a beta of 0.39, suggesting that its stock price is 61% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for First Guaranty Bancshares and BankFinancial, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Guaranty Bancshares 0 1 0 0 2.00
BankFinancial 0 1 0 0 2.00

First Guaranty Bancshares presently has a consensus target price of $28.00, suggesting a potential upside of 26.64%. Given First Guaranty Bancshares’ higher probable upside, equities research analysts clearly believe First Guaranty Bancshares is more favorable than BankFinancial.

Profitability

This table compares First Guaranty Bancshares and BankFinancial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Guaranty Bancshares 17.10% 9.94% 0.81%
BankFinancial 25.40% 7.78% 0.96%

Summary

BankFinancial beats First Guaranty Bancshares on 9 of the 14 factors compared between the two stocks.

First Guaranty Bancshares Company Profile

First Guaranty Bancshares, Inc. operates as the holding company for First Guaranty Bank that provides commercial banking services to businesses, professionals, and individuals in Louisiana and Texas. It offers various deposit products, including personal and business checking, savings, money market, and demand accounts, as well as time deposits. The company also provides loans, such as non-farm non-residential loans secured by real estate, commercial and industrial loans, one- to four-family residential loans, construction and land development loans, agricultural loans, farmland loans, consumer and other loans, and multifamily loans. In addition, it offers a range of consumer services, including personal and commercial credit cards, remote deposit capture, safe deposit boxes, official checks, Internet banking, automated teller machines, online bill pay, mobile banking, and lockbox services. The company operates through 27 banking facilities located in market services areas of Hammond, Baton Rouge, Lafayette, Shreveport-Bossier City, Dallas-Fort Worth-Arlington, and Waco. First Guaranty Bancshares, Inc. was founded in 1934 and is headquartered in Hammond, Louisiana.

BankFinancial Company Profile

BankFinancial Corporation operates as the bank holding company for BankFinancial, National Association that provides commercial, family, and personal banking products and services in Illinois. The company accepts various deposit products, including savings, NOW, checking, money market, IRA, and other retirement accounts, as well as certificates of deposit. Its loan products include multi-family and nonresidential real estate, construction and land, and commercial loans, as well as commercial leases; consumer loans; and one-to-four family residential mortgage loans, including home equity loans and lines of credit. The company also provides various financial products and services, such as cash management, fund transfer, bill payment and other online and mobile banking transactions, automated teller machines, safe deposit boxes, trust, wealth management, and general insurance agency. In addition, it offers financial planning services; and sells property and casualty, and other insurance products on an agency basis. As of February 1, 2019, the company operated 19 full-service banking offices located in Cook, DuPage, Lake, and Will Counties, Illinois. BankFinancial Corporation was founded in 1924 and is headquartered in Burr Ridge, Illinois.

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