Analyzing WSFS Financial (WSFS) & PCSB Financial (PCSB)

WSFS Financial (NASDAQ: WSFS) and PCSB Financial (NASDAQ:PCSB) are both small-cap financials companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, valuation, earnings and dividends.

Dividends

WSFS Financial pays an annual dividend of $0.36 per share and has a dividend yield of 0.8%. PCSB Financial does not pay a dividend. WSFS Financial pays out 19.6% of its earnings in the form of a dividend.

Profitability

This table compares WSFS Financial and PCSB Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
WSFS Financial 15.70% 11.46% 1.21%
PCSB Financial 3.98% 3.05% 0.49%

Institutional & Insider Ownership

80.2% of WSFS Financial shares are held by institutional investors. Comparatively, 40.4% of PCSB Financial shares are held by institutional investors. 4.9% of WSFS Financial shares are held by company insiders. Comparatively, 1.6% of PCSB Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares WSFS Financial and PCSB Financial’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
WSFS Financial $379.37 million 3.95 $59.55 million $1.84 25.92
PCSB Financial $45.04 million 7.94 $3.22 million $0.11 178.82

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for WSFS Financial and PCSB Financial, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
WSFS Financial 0 2 3 0 2.60
PCSB Financial 0 0 1 0 3.00

WSFS Financial presently has a consensus target price of $56.00, indicating a potential upside of 17.40%. PCSB Financial has a consensus target price of $19.00, indicating a potential downside of 3.41%. Given WSFS Financial’s higher probable upside, analysts clearly believe WSFS Financial is more favorable than PCSB Financial.

Summary

WSFS Financial beats PCSB Financial on 11 of the 15 factors compared between the two stocks.

WSFS Financial Company Profile

WSFS Financial Corporation is a savings and loan holding company. The Company’s subsidiary is Wilmington Savings Fund Society, FSB (WSFS Bank or the Bank), which is the bank and trust company. It operates in three segments: WSFS Bank, Cash Connect and Wealth Management. The WSFS Bank segment provides loans and other financial products to commercial and retail customers. Its Cash Connect segment provides automated teller machine (ATM) services through strategic partnerships with several of the network, manufacturers and service providers in the ATM industry. The Wealth Management segment provides a range of fiduciary, investment management, credit and deposit products to clients. Its banking business is commercial lending funded by customer-generated deposits. It also offers a range of consumer loan products, retail securities and insurance brokerage services. Its subsidiaries include WSFS Wealth Investments, 1832 Holdings, Inc., Monarch and West Capital Management.

PCSB Financial Company Profile

PCSB Financial Corporation will be the holding company of PCSB Bank (the Bank). The Bank is a mutual savings bank. The Bank attracts deposits from the general public and utilizes those funds primarily to originate and purchase residential real estate, commercial real estate and business loans, and to purchase investment securities. As of September 30, 2016, the Bank had consolidated total assets of $1.25 billion, total deposits of $1.12 billion and equity of $111.5 million. The Bank’s provides commercial lending and deposit opportunities for its customers. The Bank operates in 15 locations, offices located in Dutchess, Putnam, Rockland and Westchester Counties in New York. The Bank’s subsidiaries include PCSB Commercial Bank, PCSB Funding Corp. and PCSB Realty Ltd.

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