Pathfinder Bancorp (NASDAQ:PBHC) versus First Savings Financial Group (NASDAQ:FSFG) Critical Review

Pathfinder Bancorp (NASDAQ:PBHC) and First Savings Financial Group (NASDAQ:FSFG) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, earnings, institutional ownership, dividends, valuation and risk.

Institutional & Insider Ownership

26.7% of Pathfinder Bancorp shares are held by institutional investors. Comparatively, 35.2% of First Savings Financial Group shares are held by institutional investors. 15.4% of Pathfinder Bancorp shares are held by insiders. Comparatively, 16.1% of First Savings Financial Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Pathfinder Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.8%. First Savings Financial Group pays an annual dividend of $0.64 per share and has a dividend yield of 2.0%. Pathfinder Bancorp pays out 33.3% of its earnings in the form of a dividend. First Savings Financial Group pays out 19.3% 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. Pathfinder Bancorp has increased its dividend for 1 consecutive years and First Savings Financial Group has increased its dividend for 12 consecutive years.

Valuation and Earnings

This table compares Pathfinder Bancorp and First Savings Financial Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pathfinder Bancorp	$87.92 million	0.77	$3.38 million	$1.20	11.84
First Savings Financial Group	$146.37 million	1.55	$23.16 million	$3.31	9.75

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

Volatility and Risk

Pathfinder Bancorp has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500. Comparatively, First Savings Financial Group has a beta of 0.45, meaning that its share price is 55% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Pathfinder Bancorp and First Savings Financial Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pathfinder Bancorp	0	1	0	0	2.00
First Savings Financial Group	0	0	4	0	3.00

First Savings Financial Group has a consensus target price of $32.33, suggesting a potential upside of 0.20%. Given First Savings Financial Group’s stronger consensus rating and higher possible upside, analysts plainly believe First Savings Financial Group is more favorable than Pathfinder Bancorp.

Profitability

This table compares Pathfinder Bancorp and First Savings Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pathfinder Bancorp	9.09%	6.37%	0.53%
First Savings Financial Group	15.82%	11.51%	0.88%

Summary

First Savings Financial Group beats Pathfinder Bancorp on 15 of the 17 factors compared between the two stocks.

About Pathfinder Bancorp

Pathfinder Bancorp, Inc. operates as a bank holding company for Pathfinder Bank that provides various banking and financial products and services in New York. The company's deposit products include checking, savings, and money market deposit accounts; certificates of deposit; and demand and time deposits. Its loan portfolio comprises commercial real estate, commercial, residential real estate, construction, and tax-exempt loans; home equity loans and junior liens; and consumer loans comprising automobile, recreational vehicles, and unsecured personal loans, as well as unsecured lines of credit and loans secured by deposit accounts. The company is also involved in the property, casualty, and life insurance brokerage business. It primarily serves individuals, families, small to mid-size businesses, and municipalities. The company was founded in 1859 and is headquartered in Oswego, New York.

About First Savings Financial Group

First Savings Financial Group, Inc. operates as the bank holding company for First Savings Bank that provides various financial services to consumers and businesses in southern Indiana. The company operates through three segments: Core Banking, SBA Lending, and Mortgage Banking. It accepts deposits, such as checking accounts, NOW and money market accounts, regular savings accounts, and time deposits. The company also provides loans, including one-to four-family residential real estate, commercial real estate, construction, land and land development, multi-family real estate, and commercial business loans, as well as consumer loans, such as automobile and truck loans, home equity lines of credit, home improvement loans, unsecured loans, boat and mobile home loans, loans secured by savings deposits, and other personal loans. In addition, it is involved in the mortgage banking; investment activities; and the provision of property and casualty insurance products, and reinsurance to other third-party insurance captives. First Savings Financial Group, Inc. was incorporated in 2008 and is headquartered in Jeffersonville, Indiana.