Brookline Bancorp (BRKL) and Flagstar Bancorp (FBC) Financial Comparison

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Brookline Bancorp (NYSE: FBC) and Flagstar Bancorp (NYSE:FBC) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Volatility and Risk

Brookline Bancorp has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500. Comparatively, Flagstar Bancorp has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500.

Profitability

This table compares Brookline Bancorp and Flagstar Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Brookline Bancorp 19.97% 8.53% 1.03%
Flagstar Bancorp 7.31% 11.13% 0.92%

Dividends

Brookline Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.2%. Flagstar Bancorp does not pay a dividend. Brookline Bancorp pays out 50.0% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of recent recommendations for Brookline Bancorp and Flagstar Bancorp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Brookline Bancorp 0 3 0 0 2.00
Flagstar Bancorp 0 1 8 0 2.89

Brookline Bancorp presently has a consensus target price of $17.50, suggesting a potential downside of 2.62%. Flagstar Bancorp has a consensus target price of $41.50, suggesting a potential upside of 25.61%. Given Flagstar Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe Flagstar Bancorp is more favorable than Brookline Bancorp.

Institutional & Insider Ownership

76.3% of Brookline Bancorp shares are held by institutional investors. Comparatively, 93.9% of Flagstar Bancorp shares are held by institutional investors. 2.5% of Brookline Bancorp shares are held by company insiders. Comparatively, 62.9% of Flagstar Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Brookline Bancorp and Flagstar Bancorp’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Brookline Bancorp $295.22 million 4.90 $50.51 million $0.80 22.46
Flagstar Bancorp $997.00 million 1.91 $63.00 million $2.47 13.38

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

Summary

Flagstar Bancorp beats Brookline Bancorp on 11 of the 16 factors compared between the two stocks.

Brookline Bancorp Company Profile

Brookline Bancorp, Inc. operates as the holding company for Brookline Bank, Bank Rhode Island, First Ipswich Bank, and Brookline Securities Corp that provide commercial, business, and retail banking services to corporate, municipal, and retail customers in the United States. Its deposit products include non-interest-bearing demand checking accounts, NOW accounts, savings accounts, and money market accounts. The company's loan portfolio comprises first mortgage loans secured by commercial, multi-family, and residential real estate properties; loans to business entities comprising commercial lines of credit; loans to condominium associations; loans and leases used to finance equipment used by small businesses; financing for construction and development projects; and home equity and other consumer loans. It also provides cash management, investment advisory, and online banking services, as well as invests in debt and equity securities. As of December 31, 2017, the Company operated 51 full-service banking offices in greater Boston, the north shore of Massachusetts, and Rhode Island. Brookline Bancorp, Inc. was founded in 1871 and is headquartered in Boston, Massachusetts.

Flagstar Bancorp Company Profile

Flagstar Bancorp, Inc. operates as a savings and loan holding company for Flagstar Bank, FSB that provides commercial, small business, and consumer banking services to individuals and businesses in the United States. Its Community Banking segment offers various products, such as checking accounts, savings accounts, money market accounts, certificates of deposit, consumer and commercial loans, commercial real estate loans, equipment finance and leasing, home builder finance loans, and warehouse lines of credit. It also provides other financial services, including consumer and corporate card services, customized treasury management solutions, merchant services, and capital markets services, such as loan syndications, as well as wealth management products and services. This segment serves consumer, business, and mortgage lending customers through its branch banking, business and commercial banking, government banking, warehouse lending, and loans held-for-investment (LHFI) portfolio groups. The company's Mortgage Originations segment originates, acquires, and sells one-to-four family residential mortgage loans through home loan and national call centers, Internet and unaffiliated banks, mortgage banking, and brokerage companies. Its Mortgage Servicing segment offers services and subservices mortgage loans; and the servicing of residential mortgages for its LHFI portfolio, as well as noninterest-bearing escrow services. As of January 23, 2018, the company provided banking services through 99 branches in Michigan; and home loans through a wholesale network of brokers and correspondents in 50 states, as well as 89 retail locations in 29 states. Flagstar Bancorp, Inc. was founded in 1987 and is headquartered in Troy, Michigan.

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