ServisFirst Bancshares (NYSE:SFBS) & FFW (OTCMKTS:FFWC) Financial Comparison

FFW (OTCMKTS:FFWC) and ServisFirst Bancshares (NYSE:SFBS) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, analyst recommendations, valuation, dividends and profitability.

Profitability

This table compares FFW and ServisFirst Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FFW	16.18%	N/A	N/A
ServisFirst Bancshares	24.62%	15.47%	1.46%

Dividends

FFW pays an annual dividend of $1.20 per share and has a dividend yield of 2.9%. ServisFirst Bancshares pays an annual dividend of $1.34 per share and has a dividend yield of 1.6%. FFW pays out 25.8% of its earnings in the form of a dividend. ServisFirst Bancshares pays out 29.3% 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. ServisFirst Bancshares has increased its dividend for 10 consecutive years. FFW is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of current ratings and price targets for FFW and ServisFirst Bancshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FFW	0	0	0	0	0.00
ServisFirst Bancshares	0	2	0	0	2.00

ServisFirst Bancshares has a consensus target price of $90.50, suggesting a potential upside of 9.33%. Given ServisFirst Bancshares’ stronger consensus rating and higher possible upside, analysts clearly believe ServisFirst Bancshares is more favorable than FFW.

Valuation and Earnings

This table compares FFW and ServisFirst Bancshares”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FFW	$29.39 million	1.52	$4.09 million	$4.65	8.82
ServisFirst Bancshares	$981.18 million	4.61	$227.24 million	$4.57	18.11

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

Insider and Institutional Ownership

67.3% of ServisFirst Bancshares shares are owned by institutional investors. 17.0% of FFW shares are owned by company insiders. Comparatively, 6.7% of ServisFirst Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility & Risk

FFW has a beta of -0.04, meaning that its stock price is 104% less volatile than the S&P 500. Comparatively, ServisFirst Bancshares has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500.

Summary

ServisFirst Bancshares beats FFW on 12 of the 16 factors compared between the two stocks.

About FFW

FFW Corporation operates as the bank holding company for Crossroads Bank that provides various banking products and services. The company offers checking and savings accounts, overdraft protection, consumer credit cards, and reorder checks. Its loan products include home equity, auto, RV, boat, motorcycle, and personal loans; mortgage loans; agricultural loans; commercial real estate equipment financing; revolving lines of credit and standby letters of credit; and equipment leasing, as well as commercial lending services. The company offers insurance products, such as auto, home and property, business, life and health, and specialty insurance; investment products and securities; and digital banking services. FFW Corporation was founded in 1920 and is based in Wabash, Indiana.

About ServisFirst Bancshares

ServisFirst Bancshares, Inc. operates as the bank holding company for ServisFirst Bank that provides various banking services to individual and corporate customers. It accepts demand, time, savings, and other deposits; checking, money market, and IRA accounts; and certificates of deposit. The company's loan products include commercial lending products, including seasonal, bridge, and term loans for working capital, expansion of the business, acquisition of property, and plant and equipment, as well as commercial lines of credit; commercial real estate loans, construction and development loans, and residential real estate loans; and consumer loans, such as home equity loans, vehicle financing, loans secured by deposits, and secured and unsecured personal loans. It also offers other banking products and services comprising telephone and mobile banking, Internet banking, direct deposit, traveler's checks, safe deposit boxes, attorney trust accounts, automatic account transfers, automated teller machines, and debit and credit card systems; treasury and cash management services; wire transfer, night depository, banking-by-mail, and remote capture services; and correspondent banking services to other financial institutions. In addition, the company holds and manages participations in residential mortgages and commercial real estate loans originated by ServisFirst Bank in Alabama, Florida, Georgia, and Tennessee. The company was founded in 2005 and is headquartered in Birmingham, Alabama.