Analyzing Flagstar Financial (NYSE:FLG) & First Northwest Bancorp (NASDAQ:FNWB)

First Northwest Bancorp (NASDAQ:FNWB) and Flagstar Financial (NYSE:FLG) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their risk, valuation, institutional ownership, earnings, analyst recommendations, dividends and profitability.

Dividends

First Northwest Bancorp pays an annual dividend of $0.28 per share and has a dividend yield of 2.6%. Flagstar Financial pays an annual dividend of $0.04 per share and has a dividend yield of 0.3%. First Northwest Bancorp pays out -80.0% of its earnings in the form of a dividend. Flagstar Financial pays out -1.1% 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 Northwest Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares First Northwest Bancorp and Flagstar Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Northwest Bancorp	$124.95 million	0.81	-$6.61 million	($0.35)	-30.83
Flagstar Financial	$6.35 billion	0.79	-$1.09 billion	($3.69)	-3.29

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

Volatility and Risk

First Northwest Bancorp has a beta of 0.93, suggesting that its share price is 7% less volatile than the S&P 500. Comparatively, Flagstar Financial has a beta of 1.11, suggesting that its share price is 11% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for First Northwest Bancorp and Flagstar Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Northwest Bancorp	0	1	1	0	2.50
Flagstar Financial	0	3	2	0	2.40

First Northwest Bancorp currently has a consensus price target of $12.75, suggesting a potential upside of 18.16%. Flagstar Financial has a consensus price target of $12.90, suggesting a potential upside of 6.17%. Given First Northwest Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe First Northwest Bancorp is more favorable than Flagstar Financial.

Institutional & Insider Ownership

66.1% of First Northwest Bancorp shares are held by institutional investors. Comparatively, 67.9% of Flagstar Financial shares are held by institutional investors. 4.9% of First Northwest Bancorp shares are held by company insiders. Comparatively, 6.4% of Flagstar Financial shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
First Northwest Bancorp	-2.38%	-1.86%	-0.13%
Flagstar Financial	-17.16%	-10.72%	-0.76%

Summary

First Northwest Bancorp beats Flagstar Financial on 10 of the 16 factors compared between the two stocks.

About First Northwest Bancorp

First Northwest Bancorp operates as a bank holding company for First Fed Bank that provides commercial and consumer banking services to individuals, businesses, and nonprofit organizations in western Washington, the United States. The company accepts various deposit instruments, including checking, money market deposit, savings, and transaction accounts, as well as certificates of deposit. It also originates one- to four-family mortgage loans, commercial and multi-family real estate loans, construction and land loans, and commercial business loans, as well as consumer loans primarily consisting of automobile loans, and home-equity loans and lines of credit. First Northwest Bancorp operates branch offices in Clallam, Jefferson, King, Kitsap, and Whatcom Counties, Washington. First Northwest Bancorp was founded in 1923 and is based in Port Angeles, Washington.

About Flagstar Financial

Flagstar Financial, Inc. operates as the bank holding company for Flagstar Bank, N.A. that provides banking products and services in the United States. The company’s deposit products include interest-bearing checking and money market, savings, non-interest-bearing, and retirement accounts, as well as certificates of deposit. Its loan products comprise multi-family loans; commercial real estate loans; acquisition, development, and construction loans; commercial and industrial loans; one-to-four family loans; specialty finance loans and leases; warehouse loans; and other loans, such as home equity lines of credit, boat and recreational vehicle indirect lending, point of sale consumer loans, and other consumer loans, including overdraft loans. The company offers cash management products; non-deposit investment and insurance products; and online banking, mobile banking, and bank-by-phone services. It primarily serves individuals, small and mid-size businesses, and professional associations. The company was formerly known as New York Community Bancorp, Inc. and changed its name to Flagstar Financial, Inc. in October 2024. Flagstar Financial, Inc. was founded in 1859 and is headquartered in Hicksville, New York.