Financial Review: First Northwest Bancorp (NASDAQ:FNWB) vs. Royal Bank Of Canada (NYSE:RY)

Royal Bank Of Canada (NYSE:RY) and First Northwest Bancorp (NASDAQ:FNWB) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, institutional ownership, earnings, dividends, profitability and risk.

Risk & Volatility

Royal Bank Of Canada has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500. Comparatively, First Northwest Bancorp has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500.

Institutional & Insider Ownership

45.3% of Royal Bank Of Canada shares are held by institutional investors. Comparatively, 66.1% of First Northwest Bancorp shares are held by institutional investors. 4.1% of First Northwest Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Royal Bank Of Canada and First Northwest Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Royal Bank Of Canada	$98.11 billion	2.87	$14.54 billion	$11.43	17.79
First Northwest Bancorp	$118.64 million	0.83	-$4.19 million	$0.16	64.75

Royal Bank Of Canada has higher revenue and earnings than First Northwest Bancorp. Royal Bank Of Canada is trading at a lower price-to-earnings ratio than First Northwest Bancorp, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Royal Bank Of Canada and First Northwest Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Royal Bank Of Canada	0	5	8	1	2.71
First Northwest Bancorp	0	3	1	0	2.25

Royal Bank Of Canada presently has a consensus target price of $225.00, suggesting a potential upside of 10.65%. First Northwest Bancorp has a consensus target price of $15.00, suggesting a potential upside of 44.79%. Given First Northwest Bancorp’s higher possible upside, analysts plainly believe First Northwest Bancorp is more favorable than Royal Bank Of Canada.

Profitability

This table compares Royal Bank Of Canada and First Northwest Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Royal Bank Of Canada	16.17%	17.79%	0.97%
First Northwest Bancorp	1.32%	0.96%	0.07%

Summary

Royal Bank Of Canada beats First Northwest Bancorp on 11 of the 15 factors compared between the two stocks.

About Royal Bank Of Canada

Royal Bank of Canada operates as a diversified financial service company worldwide. The company's Personal & Commercial Banking segment offers checking and savings accounts, home equity financing, personal lending, private banking, indirect lending, including auto financing, mutual funds and self-directed brokerage accounts, guaranteed investment certificates, credit cards, and payment products and solutions; and lending, leasing, deposit, investment, foreign exchange, cash management, auto dealer financing, trade products, and services to small and medium-sized commercial businesses. This segment offers financial products and services through branches, automated teller machines, and mobile sales network. Its Wealth Management segment provides a suite of wealth, investment, trust, banking, credit, and other advice-based solutions and strategies to high net worth and ultra-high net worth individuals, and institutional clients; asset management products to institutional and individual clients; and asset and investor services to financial institutions, asset managers, and asset owners. The company's Insurance segment offers life, health, home, auto, travel, wealth, annuities, property and casualty, and reinsurance advice and solutions; and business insurance services to individual, business, and group clients through its advice centers, RBC insurance stores, and mobile advisors; digital platforms; and independent brokers and partners. The company's Capital Markets segment offers advisory and origination, sales and trading, lending and financing, and transaction banking services to corporations, institutional clients, asset managers, private equity firms, and governments. The company was founded in 1864 and is headquartered in Toronto, Canada.

About First Northwest Bancorp

First Northwest Bancorp operates as a bank holding company for First Fed Bank that provides commercial and consumer banking services to individuals, businesses, and nonprofit organizations in western Washington, the United States. The company accepts various deposit instruments, including checking, money market deposit, savings, and transaction accounts, as well as certificates of deposit. It also originates one- to four-family mortgage loans, commercial and multi-family real estate loans, construction and land loans, and commercial business loans, as well as consumer loans primarily consisting of automobile loans, and home-equity loans and lines of credit. First Northwest Bancorp operates branch offices in Clallam, Jefferson, King, Kitsap, and Whatcom Counties, Washington. First Northwest Bancorp was founded in 1923 and is based in Port Angeles, Washington.