First Defiance Financial (NASDAQ:FDEF) and Carver Bancorp (NASDAQ:CARV) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, dividends, valuation, risk, earnings and institutional ownership.

Volatility & Risk

First Defiance Financial has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500. Comparatively, Carver Bancorp has a beta of 1.84, meaning that its share price is 84% more volatile than the S&P 500.

Valuation and Earnings

This table compares First Defiance Financial and Carver Bancorp’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Defiance Financial $186.04 million 3.58 $49.37 million $2.53 6.99
Carver Bancorp $28.09 million 0.72 -$5.94 million N/A N/A

First Defiance Financial has higher revenue and earnings than Carver Bancorp.

Institutional & Insider Ownership

64.9% of First Defiance Financial shares are held by institutional investors. Comparatively, 9.8% of Carver Bancorp shares are held by institutional investors. 1.6% of First Defiance Financial shares are held by insiders. Comparatively, 0.6% of Carver Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares First Defiance Financial and Carver Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Defiance Financial 7.34% 8.19% 1.07%
Carver Bancorp -19.67% -103.47% -0.90%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for First Defiance Financial and Carver Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Defiance Financial 0 0 2 0 3.00
Carver Bancorp 0 0 0 0 N/A

First Defiance Financial currently has a consensus target price of $21.00, suggesting a potential upside of 18.78%. Given First Defiance Financial’s higher possible upside, analysts plainly believe First Defiance Financial is more favorable than Carver Bancorp.

Summary

First Defiance Financial beats Carver Bancorp on 10 of the 11 factors compared between the two stocks.

First Defiance Financial Company Profile

First Defiance Financial Corp. operates as a unitary thrift holding company that provides community-based financial services in northwest Ohio, northeast Indiana, and southeastern Michigan. It offers checking accounts, money market accounts, savings accounts, term certificate accounts, demand deposits, and certificates of deposits, as well as certificate of deposit account registry service; and commercial real estate, commercial, consumer finance, 1-4 family residential real estate, construction, and home equity and improvement loans. The company also provides trust and wealth management, and online banking services. In addition, it sells various property and casualty, group health and life, and individual health and life insurance products. The company operates through 44 full service banking centers and 1 loan production office. First Defiance Financial Corp. was incorporated in 1995 and is headquartered in Defiance, Ohio.

Carver Bancorp Company Profile

Carver Bancorp, Inc. operates as a holding company for Carver Federal Savings Bank, a federally chartered savings bank that provides consumer and commercial banking services for consumers, businesses, and governmental and quasi-governmental agencies primarily in New York. It accepts various deposit products, including demand, savings, and time deposits; passbook and statement accounts, and certificates of deposit; and individual retirement accounts. The company also provides one-to-four family residential, multifamily real estate, and commercial real estate lending products, as well as construction, business, and consumer and other loans. In addition, it offers other consumer and commercial banking products and services, including debit card, online banking, online bill pay, and telephone banking, as well as check cashing, wire transfer, bill payment, reloadable prepaid card, and money order services. The company operates through one administrative office, nine branches, and three ATM locations. Carver Bancorp, Inc. was founded in 1948 and is headquartered in New York, New York.

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