Critical Contrast: Pathfinder Bancorp (NASDAQ:PBHC) & First Savings Financial Group (NASDAQ:FSFG)

First Savings Financial Group (NASDAQ:FSFG) and Pathfinder Bancorp (NASDAQ:PBHC) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations and price targets for First Savings Financial Group and Pathfinder Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Savings Financial Group	0	0	4	0	3.00
Pathfinder Bancorp	0	1	0	0	2.00

First Savings Financial Group currently has a consensus target price of $32.33, suggesting a potential downside of 1.03%. Given First Savings Financial Group’s stronger consensus rating and higher possible upside, equities analysts plainly believe First Savings Financial Group is more favorable than Pathfinder Bancorp.

Profitability

This table compares First Savings Financial Group and Pathfinder Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Savings Financial Group	15.82%	11.51%	0.88%
Pathfinder Bancorp	9.09%	6.37%	0.53%

Insider & Institutional Ownership

35.2% of First Savings Financial Group shares are held by institutional investors. Comparatively, 26.7% of Pathfinder Bancorp shares are held by institutional investors. 16.1% of First Savings Financial Group shares are held by company insiders. Comparatively, 15.4% of Pathfinder Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares First Savings Financial Group and Pathfinder Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Savings Financial Group	$84.11 million	2.72	$23.16 million	$3.31	9.87
Pathfinder Bancorp	$87.92 million	0.77	$3.38 million	$1.20	11.83

First Savings Financial Group has higher earnings, but lower revenue than Pathfinder Bancorp. First Savings Financial Group is trading at a lower price-to-earnings ratio than Pathfinder Bancorp, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

First Savings Financial Group has a beta of 0.45, suggesting that its share price is 55% less volatile than the S&P 500. Comparatively, Pathfinder Bancorp has a beta of 0.11, suggesting that its share price is 89% less volatile than the S&P 500.

Dividends

First Savings Financial Group pays an annual dividend of $0.64 per share and has a dividend yield of 2.0%. Pathfinder Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.8%. First Savings Financial Group pays out 19.3% of its earnings in the form of a dividend. Pathfinder Bancorp pays out 33.3% 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. First Savings Financial Group has raised its dividend for 12 consecutive years and Pathfinder Bancorp has raised its dividend for 1 consecutive years.

Summary

First Savings Financial Group beats Pathfinder Bancorp on 14 of the 17 factors compared between the two stocks.

About First Savings Financial Group

First Savings Financial Group, Inc. operates as the bank holding company for First Savings Bank that provides various financial services to consumers and businesses in southern Indiana. The company operates through three segments: Core Banking, SBA Lending, and Mortgage Banking. It accepts deposits, such as checking accounts, NOW and money market accounts, regular savings accounts, and time deposits. The company also provides loans, including one-to four-family residential real estate, commercial real estate, construction, land and land development, multi-family real estate, and commercial business loans, as well as consumer loans, such as automobile and truck loans, home equity lines of credit, home improvement loans, unsecured loans, boat and mobile home loans, loans secured by savings deposits, and other personal loans. In addition, it is involved in the mortgage banking; investment activities; and the provision of property and casualty insurance products, and reinsurance to other third-party insurance captives. First Savings Financial Group, Inc. was incorporated in 2008 and is headquartered in Jeffersonville, Indiana.

About Pathfinder Bancorp

Pathfinder Bancorp, Inc. operates as a bank holding company for Pathfinder Bank that provides various banking and financial products and services in New York. The company's deposit products include checking, savings, and money market deposit accounts; certificates of deposit; and demand and time deposits. Its loan portfolio comprises commercial real estate, commercial, residential real estate, construction, and tax-exempt loans; home equity loans and junior liens; and consumer loans comprising automobile, recreational vehicles, and unsecured personal loans, as well as unsecured lines of credit and loans secured by deposit accounts. The company is also involved in the property, casualty, and life insurance brokerage business. It primarily serves individuals, families, small to mid-size businesses, and municipalities. The company was founded in 1859 and is headquartered in Oswego, New York.