Anchor Bancorp (NASDAQ: ANCB) and Chemical Financial Corporation (NASDAQ:CHFC) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, risk, dividends, profitability, valuation, earnings and institutional ownership.

Risk and Volatility

Anchor Bancorp has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Chemical Financial Corporation has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500.

Dividends

Chemical Financial Corporation pays an annual dividend of $1.12 per share and has a dividend yield of 2.5%. Anchor Bancorp does not pay a dividend. Chemical Financial Corporation pays out 49.3% of its earnings in the form of a dividend.

Insider and Institutional Ownership

76.5% of Chemical Financial Corporation shares are held by institutional investors. 6.5% of Anchor Bancorp shares are held by company insiders. Comparatively, 2.2% of Chemical Financial Corporation shares are held by company 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.

Analyst Ratings

This is a breakdown of current recommendations for Anchor Bancorp and Chemical Financial Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Anchor Bancorp 0 0 0 0 N/A
Chemical Financial Corporation 0 1 5 0 2.83

Chemical Financial Corporation has a consensus target price of $55.80, indicating a potential upside of 26.65%. Given Chemical Financial Corporation’s higher probable upside, analysts clearly believe Chemical Financial Corporation is more favorable than Anchor Bancorp.

Valuation and Earnings

This table compares Anchor Bancorp and Chemical Financial Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Anchor Bancorp $20.91 million 2.98 $2.43 million $0.97 25.67
Chemical Financial Corporation $630.88 million 4.97 $161.50 million $2.27 19.41

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

Profitability

This table compares Anchor Bancorp and Chemical Financial Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Anchor Bancorp 9.58% 3.66% 0.53%
Chemical Financial Corporation 22.28% 7.32% 1.07%

Summary

Chemical Financial Corporation beats Anchor Bancorp on 12 of the 15 factors compared between the two stocks.

Anchor Bancorp Company Profile

Anchor Bancorp is the bank holding company of Anchor Bank (the Bank). The Bank is a community-based savings bank. As of June 30, 2016, the Bank primarily served Western Washington through its 10 full-service banking offices (including a Wal-Mart in-store location) located within Grays Harbor, Thurston, Lewis, Pierce and Mason counties, and a loan production office located in King County, Washington. It is in the business of attracting deposits from the public and utilizing those deposits to originate loans. The Bank offers a range of loan products. The Bank’s operations include commercial banking services, such as lending activities, deposit products and other cash management services. The Bank offers commercial real estate loans and multi-family loans primarily in Western Washington. The Bank offers various deposit instruments, including checking accounts, money market deposit accounts, savings accounts and certificates of deposit with a range of rates.

Chemical Financial Corporation Company Profile

Chemical Financial Corporation is a financial holding company. The Company operates in the commercial banking segment. The Company, through its subsidiary bank, Chemical Bank, offers banking and fiduciary products and services. These products and services include business and personal checking accounts, savings and individual retirement accounts, time deposit instruments, electronically accessed banking products, residential and commercial real estate financing, commercial lending, consumer financing, access to insurance and investment products, corporate and personal wealth management services, and other banking services. As of December 31, 2016, the Corporation and Chemical Bank served these markets through 249 banking offices. In addition to the banking offices, Chemical Bank operated eight loan production offices and over 272 automated teller machines, both on- and off-bank premises, as of December 31, 2016. Its loan portfolio includes commercial and real estate construction.

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