Contrasting Gouverneur Bancorp Inc./MD (OTCMKTS:GOVB) and ServisFirst Bancshares (NYSE:SFBS)

ServisFirst Bancshares (NYSE:SFBS) and Gouverneur Bancorp Inc./MD (OTCMKTS:GOVB) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, dividends, institutional ownership, analyst recommendations, earnings and profitability.

Risk and Volatility

ServisFirst Bancshares has a beta of 0.91, indicating that its stock price is 9% less volatile than the S&P 500. Comparatively, Gouverneur Bancorp Inc./MD has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500.

Insider and Institutional Ownership

67.3% of ServisFirst Bancshares shares are owned by institutional investors. Comparatively, 21.6% of Gouverneur Bancorp Inc./MD shares are owned by institutional investors. 6.7% of ServisFirst Bancshares shares are owned by insiders. Comparatively, 5.4% of Gouverneur Bancorp Inc./MD shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for ServisFirst Bancshares and Gouverneur Bancorp Inc./MD, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ServisFirst Bancshares	0	2	2	1	2.80
Gouverneur Bancorp Inc./MD	0	0	0	0	0.00

ServisFirst Bancshares presently has a consensus target price of $93.67, indicating a potential upside of 27.81%. Given ServisFirst Bancshares’ stronger consensus rating and higher probable upside, research analysts clearly believe ServisFirst Bancshares is more favorable than Gouverneur Bancorp Inc./MD.

Profitability

This table compares ServisFirst Bancshares and Gouverneur Bancorp Inc./MD’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ServisFirst Bancshares	26.95%	16.36%	1.61%
Gouverneur Bancorp Inc./MD	8.69%	N/A	N/A

Dividends

ServisFirst Bancshares pays an annual dividend of $1.52 per share and has a dividend yield of 2.1%. Gouverneur Bancorp Inc./MD pays an annual dividend of $0.18 per share and has a dividend yield of 1.0%. ServisFirst Bancshares pays out 30.0% of its earnings in the form of a dividend. Gouverneur Bancorp Inc./MD pays out 21.2% 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. ServisFirst Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares ServisFirst Bancshares and Gouverneur Bancorp Inc./MD”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ServisFirst Bancshares	$1.02 billion	3.93	$276.60 million	$5.06	14.48
Gouverneur Bancorp Inc./MD	$9.72 million	1.91	$730,000.00	$0.85	20.59

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

Summary

ServisFirst Bancshares beats Gouverneur Bancorp Inc./MD on 16 of the 18 factors compared between the two stocks.

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.

About Gouverneur Bancorp Inc./MD

Gouverneur Bancorp, Inc. operates as the holding company for Gouverneur Savings and Loan Association that provides various banking products and services to individuals and businesses in New York. It accepts passbook savings, NOW, money market deposit, and checking accounts, as well as certificates of deposit. The company's loan products include mortgage loans, one- to four-family residential loans, commercial real estate loans, and multi-family residential real estate loans, residential and commercial construction loans, commercial land loans, home equity loans, lines of credit, commercial loans, automobiles, motorcycles, campers, boats, and other recreational vehicles, as well as personal secured and unsecured loans. It also invests in municipal bonds, U.S. Treasury securities, U.S. Government agencies and government-sponsored obligations, and mortgage-backed securities. In addition, the company offers online, mobile, bill pay, and telephone banking; electronic or paper statements; and ATM, debit cards, direct deposits, mobile remote deposit capture, automatic payments and transfers, bank checks, wire transfers, and safe deposit box services. It serves primarily the St. Lawrence County, and Jefferson and Lewis counties in New York State. The company was founded in 1892 and is headquartered in Gouverneur, New York.