Analyzing Sound Financial Bancorp (NASDAQ:SFBC) and Commerzbank (OTCMKTS:CRZBY)

Sound Financial Bancorp (NASDAQ:SFBC) and Commerzbank (OTCMKTS:CRZBY) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.

Insider & Institutional Ownership

68.8% of Sound Financial Bancorp shares are held by institutional investors. 12.3% of Sound Financial 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.

Risk & Volatility

Sound Financial Bancorp has a beta of 0.03, meaning that its stock price is 97% less volatile than the S&P 500. Comparatively, Commerzbank has a beta of 0.6, meaning that its stock price is 40% less volatile than the S&P 500.

Dividends

Sound Financial Bancorp pays an annual dividend of $0.84 per share and has a dividend yield of 1.9%. Commerzbank pays an annual dividend of $0.90 per share and has a dividend yield of 2.1%. Sound Financial Bancorp pays out 26.9% of its earnings in the form of a dividend. Commerzbank pays out 29.6% 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. Sound Financial Bancorp has raised its dividend for 2 consecutive years.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Sound Financial Bancorp and Commerzbank, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sound Financial Bancorp	0	0	1	0	3.00
Commerzbank	0	5	3	1	2.56

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sound Financial Bancorp	$61.52 million	1.82	$7.16 million	$3.12	13.95
Commerzbank	$26.54 billion	1.68	$2.97 billion	$3.04	13.97

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Sound Financial Bancorp	12.89%	7.31%	0.74%
Commerzbank	13.30%	8.89%	0.53%

Summary

Commerzbank beats Sound Financial Bancorp on 9 of the 17 factors compared between the two stocks.

About Sound Financial Bancorp

Sound Financial Bancorp, Inc. operates as the bank holding company for Sound Community Bank that provides banking and other financial services for consumers and businesses. It accepts various deposits products comprising savings, money market deposit, NOW, and demand accounts, as well as certificates of deposit. The company also offers loans secured by first and second mortgages on one-to four-family residences; home equity loans, including fixed-rate loans and variable-rate lines of credit; commercial and multifamily real estate loans; construction loans secured by single-family residences, and commercial and multifamily real estate; land loans; commercial business loans to finance commercial vehicles and equipment, as well as loans secured by accounts receivable and/or inventory; and secured and unsecured consumer loans, such as new and used manufactured homes, floating homes, automobiles, boats, and recreational vehicle loans, and loans secured by deposit accounts. The company was founded in 1953 and is headquartered in Seattle, Washington.

About Commerzbank

Commerzbank AG provides banking and capital market products and services to private and small business customers, corporate, financial service providers, and institutional clients in Germany, rest of Europe, the Americas, Asia, and internationally. It operates through two segments, Private and Small-Business Customers, and Corporate Clients. The company offers saving, checking, business, and current accounts; term deposits; pension; credit and debit cards; payment solutions; overdraft services; various loans; and insurance products. It also provides trade securities; treasury management; corporate financing; real estate financing; financing advisory; merger and acquisition; foreign trade; trade financing; asset and risk management; and online banking, as well as wealth management services. Commerzbank AG was founded in 1870 and is headquartered in Frankfurt am Main, Germany.