Analyzing FS Bancorp (NASDAQ:FSBW) and First National Bank Alaska (OTCMKTS:FBAK)

FS Bancorp (NASDAQ:FSBW) and First National Bank Alaska (OTCMKTS:FBAK) 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, risk, analyst recommendations, profitability, dividends, valuation and earnings.

Valuation and Earnings

This table compares FS Bancorp and First National Bank Alaska”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FS Bancorp	$206.39 million	1.44	$35.02 million	$4.10	9.51
First National Bank Alaska	$87.73 million	9.87	$67.05 million	$23.37	11.68

First National Bank Alaska has lower revenue, but higher earnings than FS Bancorp. FS Bancorp is trading at a lower price-to-earnings ratio than First National Bank Alaska, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares FS Bancorp and First National Bank Alaska’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FS Bancorp	15.10%	10.87%	1.05%
First National Bank Alaska	N/A	14.33%	1.48%

Risk and Volatility

FS Bancorp has a beta of 0.74, meaning that its share price is 26% less volatile than the S&P 500. Comparatively, First National Bank Alaska has a beta of 0.21, meaning that its share price is 79% less volatile than the S&P 500.

Insider and Institutional Ownership

63.9% of FS Bancorp shares are owned by institutional investors. 12.7% of FS Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

FS Bancorp pays an annual dividend of $1.12 per share and has a dividend yield of 2.9%. First National Bank Alaska pays an annual dividend of $16.00 per share and has a dividend yield of 5.9%. FS Bancorp pays out 27.3% of its earnings in the form of a dividend. First National Bank Alaska pays out 68.5% 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. FS Bancorp has raised its dividend for 12 consecutive years.

Analyst Recommendations

This is a summary of current recommendations for FS Bancorp and First National Bank Alaska, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FS Bancorp	0	1	1	0	2.50
First National Bank Alaska	0	0	0	0	0.00

FS Bancorp presently has a consensus price target of $41.00, indicating a potential upside of 5.10%. Given FS Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe FS Bancorp is more favorable than First National Bank Alaska.

Summary

FS Bancorp beats First National Bank Alaska on 10 of the 17 factors compared between the two stocks.

About FS Bancorp

FS Bancorp, Inc. operates as a bank holding company for 1st Security Bank of Washington that provides banking and financial services to local families, local and regional businesses, and industry niches. The company operates in two segments, Commercial and Consumer Banking; and Home Lending. It offers various deposit instruments, including checking accounts, money market deposit accounts, savings accounts, and certificates of deposit. The company provides one-to-four-family residential first mortgages, second mortgage/home equity loan products, non-mortgage commercial business loans, commercial real estate loans, and construction and development loans, as well as consumer loans, which primarily include personal lines of credit, credit cards, automobile, direct home improvement, loans on deposit, and recreational loans. It operates full bank service branches and home loan production offices in suburban communities in the greater Puget Sound area, including Snohomish, King, Pierce, Jefferson, Kitsap, Clallam, Grays Harbor, and Thurston counties; and a loan production office in the market area of the Tri-Cities. FS Bancorp, Inc. was founded in 1936 and is headquartered in Mountlake Terrace, Washington.

About First National Bank Alaska

First National Bank Alaska, a commercial bank, provides various banking products and services for business, industry, and individual customers primarily in Alaska. The company offers savings and checking accounts; money market deposits; safe deposit services; certificates of deposit; individual retirement accounts; and personal, home equity, and construction loans, as well as loans for stability and growth. It also provides investment, treasury, trust, and wealth management services; and escrow and contract collection, and bankcard services. In addition, the company offers debit and credit cards, online and mobile banking, fraud prevention, and convenience banking services. First National Bank Alaska was founded in 1922 and is headquartered in Anchorage, Alaska.