Bank OZK (NASDAQ:OZK) versus Flagstar Bank, National Association (NYSE:FLG) Financial Analysis

Flagstar Bank, National Association (NYSE:FLG) and Bank OZK (NASDAQ:OZK) are both mid-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, profitability, risk, analyst recommendations, institutional ownership, dividends and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Flagstar Bank, National Association and Bank OZK, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Flagstar Bank, National Association	2	6	5	0	2.23
Bank OZK	2	3	5	0	2.30

Flagstar Bank, National Association presently has a consensus target price of $13.88, indicating a potential upside of 7.70%. Bank OZK has a consensus target price of $58.75, indicating a potential upside of 25.67%. Given Bank OZK’s stronger consensus rating and higher probable upside, analysts plainly believe Bank OZK is more favorable than Flagstar Bank, National Association.

Valuation & Earnings

This table compares Flagstar Bank, National Association and Bank OZK”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Flagstar Bank, National Association	$6.35 billion	0.84	-$1.12 billion	($0.97)	-13.28
Bank OZK	$2.77 billion	1.89	$716.46 million	$6.20	7.54

Bank OZK has lower revenue, but higher earnings than Flagstar Bank, National Association. Flagstar Bank, National Association is trading at a lower price-to-earnings ratio than Bank OZK, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Flagstar Bank, National Association has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500. Comparatively, Bank OZK has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500.

Institutional & Insider Ownership

67.9% of Flagstar Bank, National Association shares are owned by institutional investors. Comparatively, 86.2% of Bank OZK shares are owned by institutional investors. 6.4% of Flagstar Bank, National Association shares are owned by company insiders. Comparatively, 6.7% of Bank OZK shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Flagstar Bank, National Association and Bank OZK’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Flagstar Bank, National Association	-7.06%	-3.80%	-0.30%
Bank OZK	25.81%	13.00%	1.80%

Dividends

Flagstar Bank, National Association pays an annual dividend of $0.04 per share and has a dividend yield of 0.3%. Bank OZK pays an annual dividend of $1.80 per share and has a dividend yield of 3.9%. Flagstar Bank, National Association pays out -4.1% of its earnings in the form of a dividend. Bank OZK pays out 29.0% 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. Bank OZK has increased its dividend for 29 consecutive years. Bank OZK is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Bank OZK beats Flagstar Bank, National Association on 13 of the 16 factors compared between the two stocks.

About Flagstar Bank, National Association

Flagstar Financial, Inc. operates as the bank holding company for Flagstar Bank, N.A. that provides banking products and services in the United States. The company’s deposit products include interest-bearing checking and money market, savings, non-interest-bearing, and retirement accounts, as well as certificates of deposit. Its loan products comprise multi-family loans; commercial real estate loans; acquisition, development, and construction loans; commercial and industrial loans; one-to-four family loans; specialty finance loans and leases; warehouse loans; and other loans, such as home equity lines of credit, boat and recreational vehicle indirect lending, point of sale consumer loans, and other consumer loans, including overdraft loans. The company offers cash management products; non-deposit investment and insurance products; and online banking, mobile banking, and bank-by-phone services. It primarily serves individuals, small and mid-size businesses, and professional associations. The company was formerly known as New York Community Bancorp, Inc. and changed its name to Flagstar Financial, Inc. in October 2024. Flagstar Financial, Inc. was founded in 1859 and is headquartered in Hicksville, New York.

About Bank OZK

Bank OZK provides various retail and commercial banking services for individuals and businesses in the United States. The company offers deposit services, including non-interest bearing checking, interest bearing transaction, business sweep, savings, money market, individual retirement, and other accounts, as well as time and reciprocal deposits. It also provides trust and wealth services, such as personal trusts, custodial accounts, investment management accounts, and retirement accounts, as well as corporate trust services, including trustee, paying agent and registered transfer agent services, and other related services. In addition, the company offers treasury management services comprising automated clearing house, wire transfer, transaction reporting, wholesale lockbox, remote deposit capture, automated credit line transfer, reconciliation, positive pay, commercial card, and other services, as well as zero balance and investment sweep accounts. Further, it provides real estate, consumer, small business, indirect recreational vehicle and marine, equipment, agricultural, commercial and industrial, government guaranteed, lines of credit, homebuilder, and affordable housing loans; lender and structured, business aviation, and subscription financing services; and mortgage and other lending products. Additionally, the company offers ATMs; telephone, online, and mobile banking services; credit and debit cards; safe deposit boxes; and other products and services. The company was formerly known as Bank of the Ozarks and changed its name to Bank OZK in July 2018. Bank OZK was founded in 1903 and is headquartered in Little Rock, Arkansas.