C&F Financial (NASDAQ:CFFI) and Home Bancorp (NASDAQ:HBCP) Critical Survey

C&F Financial (NASDAQ:CFFI) and Home Bancorp (NASDAQ:HBCP) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, institutional ownership, dividends, analyst recommendations, profitability, risk and earnings.

Profitability

This table compares C&F Financial and Home Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
C&F Financial	14.91%	10.72%	1.02%
Home Bancorp	22.23%	10.65%	1.32%

Insider and Institutional Ownership

37.2% of C&F Financial shares are owned by institutional investors. Comparatively, 49.4% of Home Bancorp shares are owned by institutional investors. 6.4% of C&F Financial shares are owned by insiders. Comparatively, 6.2% of Home Bancorp shares are owned by 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 summary of recent ratings and target prices for C&F Financial and Home Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
C&F Financial	0	0	1	0	3.00
Home Bancorp	0	3	1	1	2.60

Home Bancorp has a consensus target price of $69.50, suggesting a potential upside of 0.03%. Given Home Bancorp’s higher possible upside, analysts clearly believe Home Bancorp is more favorable than C&F Financial.

Valuation & Earnings

This table compares C&F Financial and Home Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
C&F Financial	$186.13 million	1.63	$26.83 million	$8.96	10.44
Home Bancorp	$209.23 million	2.60	$46.06 million	$5.98	11.62

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

Dividends

C&F Financial pays an annual dividend of $1.92 per share and has a dividend yield of 2.1%. Home Bancorp pays an annual dividend of $1.28 per share and has a dividend yield of 1.8%. C&F Financial pays out 21.4% of its earnings in the form of a dividend. Home Bancorp pays out 21.4% 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. C&F Financial has raised its dividend for 1 consecutive years and Home Bancorp has raised its dividend for 10 consecutive years.

Risk & Volatility

C&F Financial has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500. Comparatively, Home Bancorp has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500.

Summary

Home Bancorp beats C&F Financial on 12 of the 17 factors compared between the two stocks.

About C&F Financial

C&F Financial Corp. is a bank holding company, which engages in the provision of banking services to individuals and businesses. It operates through the following segments: Community Banking, Mortgage Banking and Consumer Finance. The Community Banking segment provides checking and savings deposit accounts, business, real estate, development, mortgage, home equity, and installment loans. The Mortgage Banking segment offers ancillary mortgage loan origination services for loan settlement and residential appraisals. The Consumer Finance segment consists of automobile financing through lending programs that are designed to serve customers in the non-prime market who have limited access to traditional automobile financing. The company was founded on March 8, 1994 and is headquartered in Toano, VA.

About Home Bancorp

Home Bancorp, Inc. operates as the bank holding company for Home Bank, National Association that provides various banking products and services in Louisiana, Mississippi, and Texas. It offers deposit products, including interest-bearing and noninterest-bearing checking, money market, savings, NOW, and certificates of deposit accounts. The company also provides various loan products comprising one-to four-family first mortgage loans, home equity loans and lines, commercial real estate loans, construction and land loans, multi-family residential loans, commercial and industrial loans, and consumer loans. In addition, it invests in securities; and offers credit cards and online banking services. Home Bancorp, Inc. was founded in 1908 and is headquartered in Lafayette, Louisiana.