Head-To-Head Review: Timberland Bancorp (NASDAQ:TSBK) versus Northfield Bancorp (NASDAQ:NFBK)

Timberland Bancorp (NASDAQ:TSBK) and Northfield Bancorp (NASDAQ:NFBK) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, profitability, risk, analyst recommendations and dividends.

Dividends

Timberland Bancorp pays an annual dividend of $1.04 per share and has a dividend yield of 3.3%. Northfield Bancorp pays an annual dividend of $0.52 per share and has a dividend yield of 4.9%. Timberland Bancorp pays out 30.6% of its earnings in the form of a dividend. Northfield Bancorp pays out 60.5% 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. Timberland Bancorp has increased its dividend for 13 consecutive years.

Earnings & Valuation

This table compares Timberland Bancorp and Northfield Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Timberland Bancorp	$105.96 million	2.34	$24.28 million	$3.40	9.21
Northfield Bancorp	$254.73 million	1.79	$29.94 million	$0.86	12.41

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

Risk and Volatility

Timberland Bancorp has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500. Comparatively, Northfield Bancorp has a beta of 0.84, suggesting that its share price is 16% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for Timberland Bancorp and Northfield Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Timberland Bancorp	0	0	0	0	0.00
Northfield Bancorp	0	1	1	0	2.50

Northfield Bancorp has a consensus target price of $13.00, suggesting a potential upside of 21.84%. Given Northfield Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe Northfield Bancorp is more favorable than Timberland Bancorp.

Profitability

This table compares Timberland Bancorp and Northfield Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Timberland Bancorp	24.19%	10.87%	1.41%
Northfield Bancorp	13.56%	4.64%	0.58%

Insider and Institutional Ownership

65.5% of Timberland Bancorp shares are held by institutional investors. Comparatively, 65.5% of Northfield Bancorp shares are held by institutional investors. 3.7% of Timberland Bancorp shares are held by insiders. Comparatively, 6.0% of Northfield Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Northfield Bancorp beats Timberland Bancorp on 10 of the 17 factors compared between the two stocks.

About Timberland Bancorp

Timberland Bancorp, Inc. operates as the bank holding company for Timberland Bank that provides various community banking services in Washington. It offers various deposit products, including money market deposit, checking, and regular savings accounts, as well as certificates of deposit. The company also provides one-to four-family residential, multi-family, and commercial real estate loans; and construction lending products, such as custom and owner/builder, speculative one- to four-family, commercial, multi-family, land development, and land development. In addition, it offers consumer loans comprising home equity lines of credit and second mortgage loans, automobile loans, boat loans, motorcycle loans, recreational vehicle loans, savings account loans, and unsecured loans; and commercial business loans. Timberland Bancorp, Inc. was founded in 1915 and is headquartered in Hoquiam, Washington.

About Northfield Bancorp

Northfield Bancorp, Inc. (Staten Island, NY) operates as the bank holding company for Northfield Bank that provides various banking products and services primarily to individuals and corporate customers. It accepts various deposits products, including certificates of deposit, passbook, statement, and money market savings accounts; transaction deposit accounts comprising negotiable orders of withdrawal accounts, and interest and non-interest-bearing checking accounts; and brokered deposits. The company also offers various loans comprising multifamily and other commercial real estate loans, construction and land loans, commercial and industrial loans, one-to-four family residential real estate loans, and home equity loans and lines of credit. In addition, it purchases various investment securities, such as mortgage-backed securities and corporate bonds; and deposits funds in other financial institutions, as well as holds mortgage loans, mortgage-backed securities, and other investments. Further, the company provides automated teller machines; telephone, internet, and mobile banking services; and ACH and wire transfers, cash management, positive pay, and remote deposit capture services. It operates full-service banking offices in Staten Island and Brooklyn, New York; and Hunterdon, Middlesex, Mercer, and Union counties, New Jersey. Northfield Bancorp, Inc. (Staten Island, NY) was founded in 1887 and is headquartered in Woodbridge, New Jersey.