ServisFirst Bancshares (NASDAQ:SFBS) & M&F Bancorp (OTCMKTS:MFBP) Critical Contrast

ServisFirst Bancshares (NASDAQ:SFBS) and M&F Bancorp (OTCMKTS:MFBP) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, risk, valuation and earnings.

Earnings and Valuation

This table compares ServisFirst Bancshares and M&F Bancorp’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ServisFirst Bancshares	$843.66 million	3.82	$206.85 million	$3.79	15.60
M&F Bancorp	N/A	N/A	N/A	N/A	N/A

ServisFirst Bancshares has higher revenue and earnings than M&F Bancorp.

Profitability

This table compares ServisFirst Bancshares and M&F Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ServisFirst Bancshares	24.52%	15.48%	1.39%
M&F Bancorp	N/A	N/A	N/A

Risk and Volatility

ServisFirst Bancshares has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500. Comparatively, M&F Bancorp has a beta of -0.15, indicating that its stock price is 115% less volatile than the S&P 500.

Dividends

ServisFirst Bancshares pays an annual dividend of $1.20 per share and has a dividend yield of 2.0%. M&F Bancorp pays an annual dividend of $0.20 per share and has a dividend yield of 1.6%. ServisFirst Bancshares pays out 31.7% of its earnings in the form of a dividend. ServisFirst Bancshares has increased its dividend for 10 consecutive years. ServisFirst Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of current ratings and target prices for ServisFirst Bancshares and M&F Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ServisFirst Bancshares	0	1	0	0	2.00
M&F Bancorp	0	0	0	0	N/A

ServisFirst Bancshares presently has a consensus price target of $64.00, indicating a potential upside of 8.24%. Given ServisFirst Bancshares’ higher possible upside, equities research analysts plainly believe ServisFirst Bancshares is more favorable than M&F Bancorp.

Institutional and Insider Ownership

67.3% of ServisFirst Bancshares shares are held by institutional investors. 8.2% of ServisFirst Bancshares shares are held by company insiders. Comparatively, 2.9% of M&F Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

ServisFirst Bancshares beats M&F Bancorp on 10 of the 11 factors compared between the two stocks.

About ServisFirst Bancshares

ServisFirst Bancshares, Inc. operates as the bank holding company for ServisFirst Bank that provides various banking services to individual and corporate customers. It accepts demand, time, savings, and other deposits; checking, money market, and IRA accounts; and certificates of deposit. The company's loan products include commercial lending products, including seasonal, bridge, and term loans for working capital, expansion of the business, acquisition of property, and plant and equipment, as well as commercial lines of credit; commercial real estate loans, construction and development loans, and residential real estate loans; and consumer loans, such as home equity loans, vehicle financing, loans secured by deposits, and secured and unsecured personal loans. It also offers other banking products and services comprising telephone and mobile banking, Internet banking, direct deposit, traveler's checks, safe deposit boxes, attorney trust accounts, automatic account transfers, automated teller machines, and debit and credit card systems; treasury and cash management services; wire transfer, night depository, banking-by-mail, and remote capture services; and correspondent banking services to other financial institutions. In addition, the company holds and manages participations in residential mortgages and commercial real estate loans originated by ServisFirst Bank in Alabama, Florida, Georgia, and Tennessee. The company was founded in 2005 and is headquartered in Birmingham, Alabama.

About M&F Bancorp

M&F Bancorp, Inc. operates as a bank holding company for the Mechanics and Farmers Bank that provides consumer and commercial banking products and services in North Carolina. It offers deposit products, including demand deposits; checking, savings, and money market accounts, as well as certificates of deposit. The company also provides loans for commercial and residential real estate, and construction; and consumer loans, as well as ATM services. The company was founded in 1907 and is headquartered in Durham, North Carolina.