Flagstar Bancorp (NYSE: FBC) and Farmers National Banc Corp. (NASDAQ:FMNB) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.

Valuation & Earnings

This table compares Flagstar Bancorp and Farmers National Banc Corp.’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Flagstar Bancorp $904.00 million 2.29 $171.00 million $2.36 15.36
Farmers National Banc Corp. $95.74 million 3.98 $20.55 million $0.84 16.49

Flagstar Bancorp has higher revenue and earnings than Farmers National Banc Corp.. Flagstar Bancorp is trading at a lower price-to-earnings ratio than Farmers National Banc Corp., indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

96.5% of Flagstar Bancorp shares are owned by institutional investors. Comparatively, 33.8% of Farmers National Banc Corp. shares are owned by institutional investors. 63.0% of Flagstar Bancorp shares are owned by insiders. Comparatively, 7.8% of Farmers National Banc Corp. shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Flagstar Bancorp and Farmers National Banc Corp., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Flagstar Bancorp 0 1 6 0 2.86
Farmers National Banc Corp. 0 2 0 0 2.00

Flagstar Bancorp currently has a consensus target price of $39.17, indicating a potential upside of 8.08%. Farmers National Banc Corp. has a consensus target price of $16.00, indicating a potential upside of 15.52%. Given Farmers National Banc Corp.’s higher possible upside, analysts clearly believe Farmers National Banc Corp. is more favorable than Flagstar Bancorp.

Profitability

This table compares Flagstar Bancorp and Farmers National Banc Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Flagstar Bancorp 14.56% 9.77% 0.87%
Farmers National Banc Corp. 22.39% 10.35% 1.13%

Risk and Volatility

Flagstar Bancorp has a beta of 1.01, indicating that its stock price is 1% more volatile than the S&P 500. Comparatively, Farmers National Banc Corp. has a beta of 0.41, indicating that its stock price is 59% less volatile than the S&P 500.

Dividends

Farmers National Banc Corp. pays an annual dividend of $0.24 per share and has a dividend yield of 1.7%. Flagstar Bancorp does not pay a dividend. Farmers National Banc Corp. pays out 28.6% of its earnings in the form of a dividend.

Summary

Flagstar Bancorp beats Farmers National Banc Corp. on 9 of the 16 factors compared between the two stocks.

Flagstar Bancorp Company Profile

Flagstar Bancorp, Inc. is a savings and loan holding company. The Company’s business is primarily conducted through its principal subsidiary, Flagstar Bank, FSB. It operates through four segments: Community Banking, Mortgage Originations, Mortgage Servicing, and Other. Through Mortgage Originations segment, it originates, acquires and sells one- to four-family residential mortgage loans. The Mortgage Servicing segment includes services and subservices mortgage loans, on a fee basis, for others. The Community Banking segment originates loans, provides deposits and fee based services to consumer, business and mortgage lending customers through its Branch Banking, Business and Commercial Banking, Government Banking, Warehouse Lending and Held-for-Investment Portfolio groups. It offers checking accounts, savings accounts, money market accounts, certificates of deposit and others. Other financial services include lines of credit, revolving credit, inventory and accounts receivable.

Farmers National Banc Corp. Company Profile

Farmers National Banc Corp. is a one-bank holding company. The Company’s principal business consists of owning and supervising its subsidiaries. The Company operates through tree segments: the Bank, Trust and Retirement Consulting. The Company operates principally through its subsidiaries, The Farmers National Bank of Canfield (the Bank or Farmers Bank), Farmers Trust Company (Trust or Farmers Trust), National Associates, Inc. (NAI) and Farmers National Captive, Inc. (Captive). The Bank’s subsidiaries include Farmers National Insurance, LLC (Farmers Insurance) and Farmers of Canfield Investment Co. (Farmers Investments). The banking operation offers loans, investments and deposits; the trust operations provide trust services, and the retirement consulting operations offer consulting services. The Company and its subsidiaries operate in the domestic banking, trust, retirement consulting, insurance and financial management industries.

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