BancFirst (NASDAQ:BANF – Get Rating) and Washington Federal (NASDAQ:WAFD – Get Rating) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, institutional ownership, risk, profitability, valuation, analyst recommendations and earnings.
Analyst Ratings
This is a breakdown of current recommendations for BancFirst and Washington Federal, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| BancFirst | 1 | 0 | 0 | 0 | 1.00 |
| Washington Federal | 0 | 1 | 2 | 0 | 2.67 |
BancFirst currently has a consensus target price of $89.00, indicating a potential upside of 20.63%. Washington Federal has a consensus target price of $34.00, indicating a potential upside of 32.45%. Given Washington Federal’s stronger consensus rating and higher possible upside, analysts clearly believe Washington Federal is more favorable than BancFirst.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| BancFirst | 40.57% | 17.74% | 1.72% |
| Washington Federal | 31.00% | 14.12% | 1.33% |
Valuation and Earnings
This table compares BancFirst and Washington Federal’s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| BancFirst | $595.25 million | 4.08 | $193.10 million | $6.41 | 11.51 |
| Washington Federal | $738.98 million | 2.29 | $236.33 million | $4.09 | 6.28 |
Washington Federal has higher revenue and earnings than BancFirst. Washington Federal is trading at a lower price-to-earnings ratio than BancFirst, indicating that it is currently the more affordable of the two stocks.
Dividends
BancFirst pays an annual dividend of $1.60 per share and has a dividend yield of 2.2%. Washington Federal pays an annual dividend of $1.00 per share and has a dividend yield of 3.9%. BancFirst pays out 25.0% of its earnings in the form of a dividend. Washington Federal pays out 24.4% 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. BancFirst has increased its dividend for 29 consecutive years and Washington Federal has increased its dividend for 13 consecutive years. Washington Federal is clearly the better dividend stock, given its higher yield and lower payout ratio.
Institutional and Insider Ownership
45.8% of BancFirst shares are held by institutional investors. Comparatively, 80.3% of Washington Federal shares are held by institutional investors. 35.7% of BancFirst shares are held by insiders. Comparatively, 1.5% of Washington Federal shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Risk & Volatility
BancFirst has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500. Comparatively, Washington Federal has a beta of 0.83, meaning that its share price is 17% less volatile than the S&P 500.
Summary
BancFirst beats Washington Federal on 9 of the 17 factors compared between the two stocks.
About BancFirst
BancFirst Corp. is a bank holding company, which provides retail and commercial banking services. Its services include commercial, real estate, agricultural and consumer lending, depository and funds transfer services, collections, safe deposit boxes, cash management services, retail brokerage services, and other services tailored for both individual and corporate customers. The firm operates through the following business segments: Metropolitan Banks, Community Banks, Pegasus, Worthington, and Other Financial Services, and Executive Operations and Support. The Metropolitan Banks segment consists of banking locations in the metropolitan Oklahoma City and Tulsa areas. The Community Banks segment consists of banking locations in communities throughout Oklahoma. The Pegasus Bank segment consists of banking locations in the Dallas metropolitan area. The Other Financial Services segment refers to specialty product business units, including guaranteed small business lending, residential mortgage lending, trust services, securities brokerage, electronic banking, and insurance. The Executive Operations and Support segment represents executive management, operational support, and corporate
About Washington Federal
Washington Federal, Inc. engages in the provision of lending, depository, insurance, and other banking services to consumers. It operates under the Commercial Loans and Consumer Loans segments. The Commercial Loans segment is disaggregated into five classes: multi-family, commercial real estate, commercial and industrial, construction, and land acquisition and development. The Consumer Loans segment includes single-family-residential mortgage, custom construction, consumer lot loans, home equity lines of credit, and other consumer. The company was founded on November 15, 1994 and is headquartered in Seattle, WA.
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