Head-To-Head Analysis: Pathfinder Bancorp (NASDAQ:PBHC) and TFS Financial (NASDAQ:TFSL)

TFS Financial (NASDAQ:TFSL) and Pathfinder Bancorp (NASDAQ:PBHC) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, risk, institutional ownership, earnings and analyst recommendations.

Valuation and Earnings

This table compares TFS Financial and Pathfinder Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TFS Financial	$758.78 million	5.03	$79.59 million	$0.29	46.93
Pathfinder Bancorp	$87.92 million	0.82	$3.38 million	$0.35	43.07

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

Insider and Institutional Ownership

9.8% of TFS Financial shares are owned by institutional investors. Comparatively, 26.7% of Pathfinder Bancorp shares are owned by institutional investors. 1.0% of TFS Financial shares are owned by company insiders. Comparatively, 22.4% of Pathfinder Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and target prices for TFS Financial and Pathfinder Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TFS Financial	0	2	0	0	2.00
Pathfinder Bancorp	0	1	0	0	2.00

TFS Financial currently has a consensus price target of $15.00, suggesting a potential upside of 10.21%. Given TFS Financial’s higher probable upside, research analysts clearly believe TFS Financial is more favorable than Pathfinder Bancorp.

Dividends

TFS Financial pays an annual dividend of $1.13 per share and has a dividend yield of 8.3%. Pathfinder Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.7%. TFS Financial pays out 389.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pathfinder Bancorp pays out 114.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pathfinder Bancorp has increased its dividend for 1 consecutive years.

Risk and Volatility

TFS Financial has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500. Comparatively, Pathfinder Bancorp has a beta of 0.2, indicating that its share price is 80% less volatile than the S&P 500.

Profitability

This table compares TFS Financial and Pathfinder Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TFS Financial	10.67%	4.40%	0.48%
Pathfinder Bancorp	2.98%	2.15%	0.18%

Summary

TFS Financial beats Pathfinder Bancorp on 10 of the 15 factors compared between the two stocks.

About TFS Financial

TFS Financial Corporation, through its subsidiaries, provides retail consumer banking services in the United States. Its deposit products include savings, money market, checking, individual retirement, and other qualified plan accounts, as well as certificates of deposit. The company also provides residential real estate mortgage loans, residential construction loans, and home equity loans and lines of credit, as well as purchase mortgages and first mortgage refinance loans. In addition, it offers escrow and settlement services. The company provides its products and services through its main office in Cleveland, Ohio; and multiple full-service branches and loan production offices located throughout the states of Ohio and Florida. TFS Financial Corporation was founded in 1938 and is headquartered in Cleveland, Ohio. TFS Financial Corporation is a subsidiary of Third Federal Savings and Loan Association of Cleveland, MHC.

About Pathfinder Bancorp

Pathfinder Bancorp, Inc. operates as a bank holding company for Pathfinder Bank that provides various banking and financial products and services in New York. The company's deposit products include checking, savings, and money market deposit accounts; certificates of deposit; and demand and time deposits. Its loan portfolio comprises commercial real estate, commercial, residential real estate, construction, and tax-exempt loans; home equity loans and junior liens; and consumer loans comprising automobile, recreational vehicles, and unsecured personal loans, as well as unsecured lines of credit and loans secured by deposit accounts. The company is also involved in the property, casualty, and life insurance brokerage business. It primarily serves individuals, families, small to mid-size businesses, and municipalities. The company was founded in 1859 and is headquartered in Oswego, New York.