Financial Review: ServisFirst Bancshares (NYSE:SFBS) versus Bank Hapoalim (OTCMKTS:BKHYY)

ServisFirst Bancshares (NYSE:SFBS) and Bank Hapoalim (OTCMKTS:BKHYY) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Analyst Ratings

This is a summary of recent recommendations for ServisFirst Bancshares and Bank Hapoalim, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ServisFirst Bancshares	0	1	4	0	2.80
Bank Hapoalim	0	1	0	1	3.00

ServisFirst Bancshares currently has a consensus target price of $46.50, suggesting a potential upside of 20.41%. Given ServisFirst Bancshares’ higher probable upside, research analysts plainly believe ServisFirst Bancshares is more favorable than Bank Hapoalim.

Institutional and Insider Ownership

67.3% of ServisFirst Bancshares shares are held by institutional investors. 6.5% of ServisFirst Bancshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility & Risk

ServisFirst Bancshares has a beta of 0.91, meaning that its stock price is 9% less volatile than the S&P 500. Comparatively, Bank Hapoalim has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500.

Earnings and Valuation

This table compares ServisFirst Bancshares and Bank Hapoalim”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ServisFirst Bancshares	$619.37 million	6.82	$276.60 million	$2.93	13.18
Bank Hapoalim	$12.56 billion	2.51	$2.84 billion	$11.32	10.63

Bank Hapoalim has higher revenue and earnings than ServisFirst Bancshares. Bank Hapoalim is trading at a lower price-to-earnings ratio than ServisFirst Bancshares, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares ServisFirst Bancshares and Bank Hapoalim’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ServisFirst Bancshares	30.95%	17.42%	1.82%
Bank Hapoalim	22.88%	14.08%	1.17%

Dividends

ServisFirst Bancshares pays an annual dividend of $0.76 per share and has a dividend yield of 2.0%. Bank Hapoalim pays an annual dividend of $3.75 per share and has a dividend yield of 3.1%. ServisFirst Bancshares pays out 25.9% of its earnings in the form of a dividend. Bank Hapoalim pays out 33.1% 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. ServisFirst Bancshares has raised its dividend for 10 consecutive years.

Summary

ServisFirst Bancshares beats Bank Hapoalim on 11 of the 18 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 Bank Hapoalim

Bank Hapoalim B.M., together with its subsidiaries, provides various banking and financial products and services in Israel and internationally. It operates through Household, Private Banking, Small businesses and micro businesses, Mid-sized businesses, Large businesses, Institutional entities, and Financial management segments. The company offers account-management services, lending for various purposes, deposits, and savings plans, and capital-market service; housing loans; research and advisory services; and pension advisory and retirement planning services. It also provides products and services for the expansion of a business, advanced digital services, and a service center specializing in businesses; credit for routine operations and investment financing, guarantees, letters of credit, foreign trade, and transactions in financial and derivative instruments, as well as investment services in various channels, such as foreign currency, shekels, and securities. In addition, the company offers financial services, including foreign-trade financing, financing of working capital, financing of assets overseas, complex financing transactions, syndication, and credit-risk transfers; and financing of construction projects, granting credit to customers, and issuing guarantees to buyers of homes. Further, it provides managers of mutual funds, managers of investment portfolios, and managers of provident funds, study funds, and pension funds; trading activities; underwriting services; and brokerage and custody services. The company serves households, private-banking customers, foreign residents, small businesses, financial-asset managers, middle-market business clients, and large corporations. Bank Hapoalim B.M. was founded in 1921 and is based in Tel Aviv, Israel.