Contrasting First Hawaiian (NASDAQ:FHB) and Northeast Community Bancorp (NASDAQ:NECB)

First Hawaiian (NASDAQ:FHB) and Northeast Community Bancorp (NASDAQ:NECB) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, profitability, institutional ownership, dividends, valuation and risk.

Institutional & Insider Ownership

97.6% of First Hawaiian shares are held by institutional investors. Comparatively, 53.2% of Northeast Community Bancorp shares are held by institutional investors. 0.7% of First Hawaiian shares are held by insiders. Comparatively, 7.1% of Northeast Community Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings for First Hawaiian and Northeast Community Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Hawaiian	2	7	2	0	2.00
Northeast Community Bancorp	0	1	1	2	3.25

First Hawaiian presently has a consensus price target of $29.00, suggesting a potential upside of 14.44%. Northeast Community Bancorp has a consensus price target of $29.50, suggesting a potential upside of 6.23%. Given First Hawaiian’s higher possible upside, research analysts plainly believe First Hawaiian is more favorable than Northeast Community Bancorp.

Profitability

This table compares First Hawaiian and Northeast Community Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Hawaiian	24.41%	10.27%	1.19%
Northeast Community Bancorp	27.21%	11.55%	1.99%

Risk & Volatility

First Hawaiian has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500. Comparatively, Northeast Community Bancorp has a beta of 0.38, suggesting that its stock price is 62% less volatile than the S&P 500.

Dividends

First Hawaiian pays an annual dividend of $1.04 per share and has a dividend yield of 4.1%. Northeast Community Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 3.6%. First Hawaiian pays out 45.2% of its earnings in the form of a dividend. Northeast Community Bancorp pays out 32.9% 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. Northeast Community Bancorp has raised its dividend for 2 consecutive years.

Valuation & Earnings

This table compares First Hawaiian and Northeast Community Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Hawaiian	$1.17 billion	2.64	$276.27 million	$2.30	11.02
Northeast Community Bancorp	$158.21 million	2.42	$44.41 million	$3.04	9.13

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

About First Hawaiian

First Hawaiian, Inc. operates as a bank holding company for First Hawaiian Bank that provides a range of banking products and services to consumer and commercial customers in the United States. It operates in three segments: Retail Banking, Commercial Banking, and Treasury and Other. The company offers various deposit products, including checking, savings, and time deposit accounts, and other deposit accounts. It also provides residential and commercial mortgage loans, home equity lines of credit and loans, automobile loans and leases, secured and unsecured lines of credit, installment loans, small business loans and leases, and construction lending, as well as commercial lease and auto dealer financing. In addition, the company offers wealth management, personal installment, individual investment and financial planning, insurance protection, trust and estate, private banking, investment management, retirement planning, and merchant processing services, as well as consumer and commercial credit cards. The company was formerly known as BancWest Corporation and changed its name to First Hawaiian, Inc. in April 2016. First Hawaiian, Inc. was founded in 1858 and is headquartered in Honolulu, Hawaii.

About Northeast Community Bancorp

Northeast Community Bancorp, Inc. operates as the holding company for NorthEast Community Bank that provides financial services for individuals and businesses. It accepts various deposit instruments, including checking accounts, money market accounts, regular savings accounts, and non-interest bearing demand accounts, as well as certificates of deposits. The company also offers construction, commercial and industrial, multifamily and mixed-use real estate, non-residential real estate loans, and consumer loans. In addition, it invests in various types of liquid assets, including U.S. Treasury obligations, municipal securities, deposits at the Federal Home Loan Bank of New York, and certificates of deposit of federally insured institutions, as well as securities of various federal agencies, and of state and municipal governments. Further, the company offers financial planning and investment advisory services; and life insurance products and fixed-rate annuities. It operates full-service branches located in Bronx, New York, Orange, Rockland, and Sullivan Counties in New York and Essex, Middlesex, and Norfolk Counties in Massachusetts; and loan production offices located in White Plains, New York, and New City counties in New York and Danvers, Massachusetts. Northeast Community Bancorp, Inc. was founded in 1934 and is headquartered in White Plains, New York.