Analyzing Timberland Bancorp (NASDAQ:TSBK) and First Niles Financial (OTCMKTS:FNFI)

Timberland Bancorp (NASDAQ:TSBK) and First Niles Financial (OTCMKTS:FNFI) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, profitability, risk, institutional ownership and earnings.

Analyst Ratings

This is a summary of current recommendations and price targets for Timberland Bancorp and First Niles Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Timberland Bancorp	0	0	1	0	3.00
First Niles Financial	0	0	0	0	0.00

Dividends

Timberland Bancorp pays an annual dividend of $1.16 per share and has a dividend yield of 3.0%. First Niles Financial pays an annual dividend of $0.24 per share and has a dividend yield of 3.1%. Timberland Bancorp pays out 30.1% of its earnings in the form of a dividend. First Niles Financial pays out 77.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Timberland Bancorp has raised its dividend for 13 consecutive years.

Insider & Institutional Ownership

65.5% of Timberland Bancorp shares are owned by institutional investors. 3.6% of Timberland Bancorp shares are owned by insiders. Comparatively, 23.4% of First Niles Financial shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Timberland Bancorp and First Niles Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Timberland Bancorp	$114.63 million	2.68	$29.16 million	$3.86	10.11
First Niles Financial	$14.03 million	0.85	$840,000.00	$0.31	25.00

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

Profitability

This table compares Timberland Bancorp and First Niles Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Timberland Bancorp	26.17%	11.73%	1.54%
First Niles Financial	N/A	N/A	N/A

Risk and Volatility

Timberland Bancorp has a beta of 0.36, meaning that its share price is 64% less volatile than the S&P 500. Comparatively, First Niles Financial has a beta of 0.29, meaning that its share price is 71% less volatile than the S&P 500.

Summary

Timberland Bancorp beats First Niles Financial on 13 of the 16 factors compared between the two stocks.

About Timberland Bancorp

Timberland Bancorp, Inc. operates as the bank holding company for Timberland Bank that provides various community banking services in Washington. It offers various deposit products, including money market deposit, checking, and regular savings accounts, as well as certificates of deposit. The company also provides one-to four-family residential, multi-family, and commercial real estate loans; and construction lending products, such as custom and owner/builder, speculative one- to four-family, commercial, multi-family, land development, and land development. In addition, it offers consumer loans comprising home equity lines of credit and second mortgage loans, automobile loans, boat loans, motorcycle loans, recreational vehicle loans, savings account loans, and unsecured loans; and commercial business loans. Timberland Bancorp, Inc. was founded in 1915 and is headquartered in Hoquiam, Washington.

About First Niles Financial

First Niles Financial, Inc. operates as a holding company for the Home Federal Savings and Loan Association of Niles that provides various banking products and services in Ohio, the United States. The company offers personal and business checking and savings, money market deposit, and Christmas club accounts, as well as certificates of deposit. It also provides various loans, including mortgage and consumer loans, home equity lines of credit, and commercial loans and lines of credit. In addition, the company provides e-statement, and night depository services; debit and ATM cards; safe deposit boxes; direct deposits; I.R.A. certificates of deposit and savings accounts; and online banking services. First Niles Financial, Inc. was founded in 1897 and is based in Niles, Ohio.