Contrasting CF Bankshares (NASDAQ:CFBK) & Hanover Bancorp (NASDAQ:HNVR)

Hanover Bancorp (NASDAQ:HNVR) and CF Bankshares (NASDAQ:CFBK) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Hanover Bancorp and CF Bankshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hanover Bancorp	0	3	2	0	2.40
CF Bankshares	0	2	1	0	2.33

Hanover Bancorp currently has a consensus target price of $24.50, indicating a potential upside of 4.46%. CF Bankshares has a consensus target price of $29.00, indicating a potential upside of 11.47%. Given CF Bankshares’ higher probable upside, analysts clearly believe CF Bankshares is more favorable than Hanover Bancorp.

Institutional and Insider Ownership

15.0% of Hanover Bancorp shares are owned by institutional investors. Comparatively, 41.1% of CF Bankshares shares are owned by institutional investors. 23.9% of Hanover Bancorp shares are owned by company insiders. Comparatively, 21.0% of CF Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Hanover Bancorp and CF Bankshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hanover Bancorp	$72.72 million	2.32	$12.35 million	$1.52	15.43
CF Bankshares	$123.56 million	1.34	$13.39 million	$2.49	10.45

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

Risk & Volatility

Hanover Bancorp has a beta of 0.04, indicating that its share price is 96% less volatile than the S&P 500. Comparatively, CF Bankshares has a beta of 0.47, indicating that its share price is 53% less volatile than the S&P 500.

Dividends

Hanover Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 1.7%. CF Bankshares pays an annual dividend of $0.32 per share and has a dividend yield of 1.2%. Hanover Bancorp pays out 26.3% of its earnings in the form of a dividend. CF Bankshares pays out 12.9% 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. CF Bankshares has increased its dividend for 4 consecutive years.

Profitability

This table compares Hanover Bancorp and CF Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hanover Bancorp	7.82%	7.20%	0.60%
CF Bankshares	12.78%	9.23%	0.77%

Summary

CF Bankshares beats Hanover Bancorp on 11 of the 17 factors compared between the two stocks.

About Hanover Bancorp

Hanover Bancorp, Inc., a bank holding company for Hanover Community Bank, provides personal and business lending and deposit services to businesses, municipalities, and individuals in the New York metro area. The company offers checking, credit cards, debit cards, money market, savings, government and municipal banking, and professional services, as well as time deposits, including certificate of deposit and individual retirement accounts. It also provides business loans, commercial real estate financing, small business administration, lending directory services, and residential mortgage. In addition, the company offers cash management, online and mobile banking, merchant services, and digital solutions. Its banking offices are located in Nassau, Suffolk, Queens, Kings, New York Counties, New York, Monmouth County, Freehold, and New Jersey. The company was founded in 2008 and is headquartered in Mineola, New York.

About CF Bankshares

CF Bankshares Inc. operates as the bank holding company for CFBank, National Association that provides various banking products and services in the United States. The company accepts savings, retail and business checking accounts, and money market accounts, as well as certificates of deposit. It offers single-family mortgage loans; commercial real estate and multi-family residential mortgage loans; commercial loans and equipment leases; residential real estate loans and treasury management depository services; retail banking services and products. In addition, the company offers consumer loans, such as home equity lines of credit, home improvement loans, and loans secured by deposits and purchased loans, as well as other loans. Further, it provides online internet banking, mobile banking, and remote deposits. The company was formerly known as Central Federal Corporation and changed its name to CF Bankshares Inc. in July 2020. CF Bankshares Inc. was founded in 1892 and is based in Columbus, Ohio.