Analyzing Banner (NASDAQ:BANR) & M&F Bancorp (OTCMKTS:MFBP)

M&F Bancorp (OTCMKTS:MFBPGet Rating) and Banner (NASDAQ:BANRGet Rating) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, dividends, earnings, profitability, analyst recommendations, valuation and risk.

Dividends

M&F Bancorp pays an annual dividend of $0.12 per share and has a dividend yield of 1.7%. Banner pays an annual dividend of $1.76 per share and has a dividend yield of 3.2%. Banner pays out 30.5% of its earnings in the form of a dividend. Banner has increased its dividend for 1 consecutive years. Banner is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares M&F Bancorp and Banner’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
M&F Bancorp N/A N/A N/A N/A N/A
Banner $616.92 million 3.08 $201.05 million $5.77 9.61

Banner has higher revenue and earnings than M&F Bancorp.

Institutional & Insider Ownership

83.8% of Banner shares are owned by institutional investors. 2.9% of M&F Bancorp shares are owned by insiders. Comparatively, 1.4% of Banner shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares M&F Bancorp and Banner’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
M&F Bancorp N/A N/A N/A
Banner 32.62% 12.42% 1.26%

Analyst Recommendations

This is a summary of current ratings and recommmendations for M&F Bancorp and Banner, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
M&F Bancorp 0 0 0 0 N/A
Banner 0 1 0 1 3.00

Banner has a consensus price target of $66.00, indicating a potential upside of 19.00%. Given Banner’s higher probable upside, analysts clearly believe Banner is more favorable than M&F Bancorp.

Volatility & Risk

M&F Bancorp has a beta of 0.66, indicating that its stock price is 34% less volatile than the S&P 500. Comparatively, Banner has a beta of 1.05, indicating that its stock price is 5% more volatile than the S&P 500.

Summary

Banner beats M&F Bancorp on 10 of the 12 factors compared between the two stocks.

M&F Bancorp Company Profile (Get Rating)

M&F Bancorp, Inc. operates as a bank holding company for the Mechanics and Farmers Bank that provides consumer and commercial banking products and services in North Carolina. It offers deposit products, including demand deposits; checking, savings, and money market accounts, as well as certificates of deposit. The company also provides loans for commercial and residential real estate, and construction; and consumer loans, as well as ATM services. It operates seven branch offices in Durham, Raleigh, Charlotte, Greensboro, and Winston-Salem, North Carolina. The company was founded in 1907 and is headquartered in Durham, North Carolina.

Banner Company Profile (Get Rating)

Banner Corporation operates as the bank holding company for Banner Bank that provide commercial banking and financial products and services to individuals, businesses, and public sector entities in the United States. It accepts various deposit instruments, including interest-bearing and non-interest-bearing checking accounts, money market deposit accounts, regular savings accounts, and certificates of deposit, as well as treasury management services and retirement savings plans. The company also provides commercial real estate loans, including owner-occupied, investment properties, and multifamily residential real estate loans; construction, land, and land development loans; residential mortgage loans; commercial business loans; agricultural loans; and consumer and other loans, such as home equity lines of credit, automobile, and boat and recreational vehicle loans, as well as loans secured by deposit accounts. In addition, it engages in the mortgage banking operations through the origination and sale of one-to four-family and multi-family residential loans, as well as small business administration loans. Further, the company provides electronic and digital banking services. As of December 31, 2021, it operated 150 branch offices and 18 loan production offices located in Washington, Oregon, California, Idaho, and Utah. Banner Corporation was founded in 1890 and is headquartered in Walla Walla, Washington.

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