Analyzing Northfield Bancorp (NASDAQ:NFBK) & Sturgis Bancorp (OTCMKTS:STBI)

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

Valuation and Earnings

This table compares Sturgis Bancorp and Northfield Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sturgis Bancorp	$59.13 million	0.88	$7.46 million	$3.45	6.96
Northfield Bancorp	$266.05 million	2.08	$800,000.00	$0.01	1,322.00

Sturgis Bancorp has higher earnings, but lower revenue than Northfield Bancorp. Sturgis 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.

Dividends

Sturgis Bancorp pays an annual dividend of $0.72 per share and has a dividend yield of 3.0%. Northfield Bancorp pays an annual dividend of $0.52 per share and has a dividend yield of 3.9%. Sturgis Bancorp pays out 20.9% of its earnings in the form of a dividend. Northfield Bancorp pays out 5,200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Sturgis Bancorp and Northfield Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sturgis Bancorp	0	0	0	0	0.00
Northfield Bancorp	1	1	1	0	2.00

Northfield Bancorp has a consensus price target of $14.33, suggesting a potential upside of 8.42%. Given Northfield Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe Northfield Bancorp is more favorable than Sturgis Bancorp.

Insider and Institutional Ownership

65.5% of Northfield Bancorp shares are owned by institutional investors. 16.0% of Sturgis Bancorp shares are owned by insiders. Comparatively, 6.0% of Northfield Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Sturgis Bancorp has a beta of 0.12, suggesting that its stock price is 88% less volatile than the S&P 500. Comparatively, Northfield Bancorp has a beta of 0.82, suggesting that its stock price is 18% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Sturgis Bancorp	12.61%	N/A	N/A
Northfield Bancorp	0.30%	5.91%	0.73%

Summary

Northfield Bancorp beats Sturgis Bancorp on 11 of the 16 factors compared between the two stocks.

About Sturgis Bancorp

Sturgis Bancorp, Inc. operates as the bank holding company for Sturgis Bank & Trust Company that provides banking products and services in Michigan, the United States. The company offers checking, savings and health savings, and money market accounts; and certificates of deposit and individual retirement accounts. It also provides mortgage, automobile, savings secured, personal, home equity, equipment and machinery, government supported, and commercial real estate loans, as well as home equity lines of credit and business lines of credit; and credit cards. In addition, the company offers private banking, cashier checks, wire transfers, foreign drafts and foreign currency, overdraft protection, night depository, and notary services, as well as safe deposit boxes and residential mortgages. Further, it provides direct deposit, remote deposit capture, Visa check card, and checks reorder services; and investment and financial-advisory services, as well as commercial and consumer insurance and title insurance products. Additionally, the company offers estate and asset management services, such as estate settlements, trust administration, record keeping, investment management, and custody services; cash and treasury management; and online and mobile banking, bill pay, and mobile wallet services. It operates through 14 bank facilities and 4 full service standalone ATMs located in 12 communities in Michigan. Sturgis Bancorp, Inc. was founded in 1905 and is headquartered in Sturgis, Michigan.

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.