Analyzing California First National Bancorp (CFNB) and Meridian Bancorp (EBSB)

California First National Bancorp (OTCMKTS:CFNB) and Meridian Bancorp (NASDAQ:EBSB) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, dividends, institutional ownership, risk, earnings, profitability and analyst recommendations.

Profitability

This table compares California First National Bancorp and Meridian Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
California First National Bancorp N/A N/A N/A
Meridian Bancorp 22.37% 8.99% 1.07%

Analyst Recommendations

This is a breakdown of current recommendations for California First National Bancorp and Meridian Bancorp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
California First National Bancorp 0 0 0 0 N/A
Meridian Bancorp 0 1 0 0 2.00

Meridian Bancorp has a consensus price target of $24.00, suggesting a potential upside of 55.04%. Given Meridian Bancorp’s higher probable upside, analysts plainly believe Meridian Bancorp is more favorable than California First National Bancorp.

Institutional and Insider Ownership

0.2% of California First National Bancorp shares are held by institutional investors. Comparatively, 66.2% of Meridian Bancorp shares are held by institutional investors. 78.5% of California First National Bancorp shares are held by insiders. Comparatively, 5.3% of Meridian Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares California First National Bancorp and Meridian Bancorp’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
California First National Bancorp $36.69 million 4.37 $11.12 million N/A N/A
Meridian Bancorp $208.17 million 4.03 $42.94 million $0.95 16.29

Meridian Bancorp has higher revenue and earnings than California First National Bancorp.

Dividends

California First National Bancorp pays an annual dividend of $0.50 per share and has a dividend yield of 3.2%. Meridian Bancorp pays an annual dividend of $0.20 per share and has a dividend yield of 1.3%. Meridian Bancorp pays out 21.1% of its earnings in the form of a dividend. Meridian Bancorp has increased its dividend for 2 consecutive years.

Risk and Volatility

California First National Bancorp has a beta of 0.16, indicating that its share price is 84% less volatile than the S&P 500. Comparatively, Meridian Bancorp has a beta of 0.21, indicating that its share price is 79% less volatile than the S&P 500.

Summary

Meridian Bancorp beats California First National Bancorp on 10 of the 14 factors compared between the two stocks.

California First National Bancorp Company Profile

California First National Bancorp operates as the bank holding company for California First National Bank that provides banking services in the United States. The company accepts interest-bearing checking, money market, and savings accounts, as well as certificates of deposit and IRA deposit products. It also provides commercial loan products, including lines of credit, term loans, and commercial mortgages; and syndicated loans. In addition, the company, through its subsidiary, California First Leasing Corp., leases and finances capital assets used by businesses and organizations comprising computer systems and networks, automated warehouse distribution management systems, and manufacturing production systems; retail point-of-sale and inventory tracking systems; telecommunications systems, including wireless networks, voice over Internet protocol systems, and satellite tracking systems; and other equipment, as well as non-electronic properties, such as office equipment, mining equipment, machine tools, school buses, trucks, exercise equipment, and office and dormitory furniture. It serves corporations and middle-market companies, private and state-related educational institutions, municipalities, and other not-for-profit organizations and institutions. California First National Bancorp was founded in 1977 and is headquartered in Irvine, California.

Meridian Bancorp Company Profile

Meridian Bancorp, Inc. operates as the holding company for East Boston Savings Bank that provides various financial products and services for individuals and businesses primarily in Essex, Middlesex, Norfolk, and Suffolk Counties, Massachusetts. The company accepts various deposit products, including non-interest-bearing demand deposits, such as checking accounts; interest-bearing demand accounts comprising NOW and money market accounts; savings accounts; and certificates of deposits, as well as commercial checking accounts. Its loan portfolio includes commercial real estate loans, which are secured by properties used for business purposes, such as office buildings, industrial facilities, and retail facilities; one- to four-family residential loans comprising mortgage loans that enable borrowers to purchase or refinance existing homes; multi-family real estate loans; construction loans; commercial and industrial loans; home equity lines of credit; and consumer loans that include automobile loans, loans secured by savings or certificate accounts, credit builders, and annuity and overdraft loans. In addition, the company offers non-deposit financial products, which comprise mutual funds, annuities, stocks, and bonds through a third-party broker-dealer; and long-term care insurance products. Further, it is also involved in the securities transactions business; and holding foreclosed real estate properties. As of March 1, 2018, the company operated 33 full-service locations, as well 1 mobile branch and 3 loan centers. Meridian Bancorp, Inc. was founded in 1848 and is headquartered in Peabody, Massachusetts.

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