SHF (NASDAQ:SHFS) and Ponce Financial Group (NASDAQ:PDLB) Financial Review

SHF (NASDAQ:SHFS) and Ponce Financial Group (NASDAQ:PDLB) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, institutional ownership, profitability, analyst recommendations, risk, valuation and dividends.

Institutional and Insider Ownership

29.2% of SHF shares are held by institutional investors. Comparatively, 64.4% of Ponce Financial Group shares are held by institutional investors. 5.8% of SHF shares are held by insiders. Comparatively, 7.2% of Ponce Financial Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and recommmendations for SHF and Ponce Financial Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SHF	1	0	0	0	1.00
Ponce Financial Group	0	0	1	2	3.67

Ponce Financial Group has a consensus target price of $24.00, suggesting a potential upside of 21.95%. Given Ponce Financial Group’s stronger consensus rating and higher probable upside, analysts plainly believe Ponce Financial Group is more favorable than SHF.

Earnings & Valuation

This table compares SHF and Ponce Financial Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SHF	$7.67 million	0.14	-$2.16 million	($0.96)	-0.25
Ponce Financial Group	$194.94 million	2.44	$28.70 million	$1.30	15.14

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

Profitability

This table compares SHF and Ponce Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SHF	-40.35%	-561.02%	-43.79%
Ponce Financial Group	15.74%	10.09%	0.98%

Risk and Volatility

SHF has a beta of 0.71, suggesting that its stock price is 29% less volatile than the S&P 500. Comparatively, Ponce Financial Group has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500.

Summary

Ponce Financial Group beats SHF on 14 of the 15 factors compared between the two stocks.

About SHF

SHF Holdings, Inc., through its subsidiaries, provides access to banking, lending, and other financial services to financial institutions serving the cannabis industry. The company, through its proprietary platform, offers access to business checking and savings accounts, cash management accounts, savings and investment options, commercial lending, courier services, remote deposit services, automated clearing house payments and origination, and wire payments. Its services allow cannabis related businesses to obtain services from financial institutions that allow them to run their business with enhanced financial insight into their business and access to resources. The company was founded in 2015 and is based in Golden, Colorado. SHF Holdings, Inc. operates as a subsidiary of Partner Colorado Credit Union.

About Ponce Financial Group

Ponce Financial Group, Inc. operates as the bank holding company for Ponce Bank that provides various banking products and services. It offers various deposit products, including demand accounts, NOW/IOLA, money market, reciprocal deposits, savings accounts, and certificates of deposit to individuals, business entities, and non-profit organizations, as well as individual retirement accounts. The company also provides real estate-secured loans, which includes one-to-four family investor-owned and owner-occupied residential; multifamily residential; nonresidential property; construction and land; commercial and industrial; and business and consumer loans, as well as lines of credit. In addition, it invests in securities, which consist of U.S. Government and federal agency securities and securities issued by government-sponsored or owned enterprises, as well as corporate securities, mortgage-backed securities, and Federal Home Loan Bank stock. Ponce Financial Group, Inc. was founded in 1960 and is headquartered in Bronx, New York.