TFS Financial (NASDAQ:TFSL) and Territorial Bancorp (NASDAQ:TBNK) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, profitability, dividends, risk and earnings.

Risk & Volatility

TFS Financial has a beta of 0.14, meaning that its stock price is 86% less volatile than the S&P 500. Comparatively, Territorial Bancorp has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500.

Insider & Institutional Ownership

11.4% of TFS Financial shares are owned by institutional investors. Comparatively, 48.1% of Territorial Bancorp shares are owned by institutional investors. 1.6% of TFS Financial shares are owned by insiders. Comparatively, 10.8% of Territorial Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares TFS Financial and Territorial Bancorp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TFS Financial $502.55 million 12.13 $80.24 million $0.28 77.71
Territorial Bancorp $83.40 million 3.49 $22.00 million $2.34 12.84

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

Dividends

TFS Financial pays an annual dividend of $1.08 per share and has a dividend yield of 5.0%. Territorial Bancorp pays an annual dividend of $0.92 per share and has a dividend yield of 3.1%. TFS Financial pays out 385.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Territorial Bancorp pays out 39.3% of its earnings in the form of a dividend. TFS Financial has raised its dividend for 2 consecutive years and Territorial Bancorp has raised its dividend for 7 consecutive years.

Profitability

This table compares TFS Financial and Territorial Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TFS Financial 16.72% 4.99% 0.60%
Territorial Bancorp 26.37% 9.09% 1.06%

Analyst Ratings

This is a breakdown of current ratings and target prices for TFS Financial and Territorial Bancorp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TFS Financial 0 0 0 0 N/A
Territorial Bancorp 0 1 0 0 2.00

Summary

Territorial Bancorp beats TFS Financial on 9 of the 14 factors compared between the two stocks.

About TFS Financial

TFS Financial Corporation, through its subsidiaries, provides retail consumer banking services in the United States. The company's deposit products include savings, money market, checking, certificate of deposit, individual retirement, and other qualified plan accounts. It also provides residential real estate mortgage loans, residential construction loans, and home equity loans and lines of credit, as well as purchase mortgages and first mortgage refinance loans. In addition, the company engages in the net lease transactions of commercial buildings; and provision of escrow and settlement services. It provides its products and services through its main office in Cleveland, Ohio; and 38 full-service branches and 8 loan production offices located throughout the states of Ohio and Florida. The company was founded in 1938 and is headquartered in Cleveland, Ohio. TFS Financial Corporation is a subsidiary of Third Federal Savings and Loan Association of Cleveland, MHC.

About Territorial Bancorp

Territorial Bancorp, Inc. operates as the bank holding company for Territorial Savings Bank, which provides financial services to individuals, families, and businesses in Hawaii. Its business consists primarily of accepting deposits from the general public and investing those deposits, together with funds generated from operations and borrowings, in one- to four-family residential mortgage loans and investment securities. The firm operates through the following portfolio segments: Residential Mortgage; Construction, Commercial and Other Mortgage Loans; Home Equity Loans and Lines of Credit; and Consumer and Other. It also offers deposit accounts, including passbook and statement savings accounts, certificates of deposit, money market accounts, commercial, and regular checking accounts. The company was founded on November 3, 2008 and is headquartered in Honolulu, HI.

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