Head-To-Head Contrast: MutualFirst Financial (MFSF) vs. Investors Bancorp (NASDAQ:ISBC)

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

Dividends

Investors Bancorp pays an annual dividend of $0.36 per share and has a dividend yield of 2.9%. MutualFirst Financial pays an annual dividend of $0.72 per share and has a dividend yield of 2.0%. Investors Bancorp pays out 58.1% of its earnings in the form of a dividend. MutualFirst Financial pays out 37.7% 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. Investors Bancorp has increased its dividend for 3 consecutive years and MutualFirst Financial has increased its dividend for 4 consecutive years.

Profitability

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

Net Margins Return on Equity Return on Assets
Investors Bancorp 16.21% 6.71% 0.83%
MutualFirst Financial 15.56% 9.92% 0.95%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Investors Bancorp and MutualFirst Financial, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Investors Bancorp 0 3 3 0 2.50
MutualFirst Financial 0 2 0 0 2.00

Investors Bancorp currently has a consensus target price of $14.92, suggesting a potential upside of 21.67%. MutualFirst Financial has a consensus target price of $39.00, suggesting a potential upside of 5.81%. Given Investors Bancorp’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Investors Bancorp is more favorable than MutualFirst Financial.

Valuation and Earnings

This table compares Investors Bancorp and MutualFirst Financial’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Investors Bancorp $917.32 million 4.80 $126.74 million $0.62 19.77
MutualFirst Financial $76.94 million 4.12 $12.31 million $1.91 19.30

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

Institutional and Insider Ownership

63.4% of Investors Bancorp shares are held by institutional investors. Comparatively, 46.7% of MutualFirst Financial shares are held by institutional investors. 3.5% of Investors Bancorp shares are held by insiders. Comparatively, 28.0% of MutualFirst Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Risk & Volatility

Investors Bancorp has a beta of 0.58, meaning that its share price is 42% less volatile than the S&P 500. Comparatively, MutualFirst Financial has a beta of 0.13, meaning that its share price is 87% less volatile than the S&P 500.

Summary

Investors Bancorp beats MutualFirst Financial on 11 of the 17 factors compared between the two stocks.

Investors Bancorp Company Profile

Investors Bancorp, Inc. operates as the holding company for Investors Bank that provides various banking products and services to individuals and businesses in the United States. Its deposit products include savings, checking, and money market accounts, as well as certificates of deposit. The company's loan portfolio comprises multi-family, commercial real estate, commercial and industrial, and construction loans; consumer and other loans primarily consisting of home equity loans, home equity lines of credit, and cash surrender value lending on life insurance contracts; and one-to four-family residential mortgage loans secured by one-to four-family residential real estate. As of December 31, 2017, it operated through a network of 156 offices in New Jersey and New York. The company was founded in 1926 and is headquartered in Short Hills, New Jersey.

MutualFirst Financial Company Profile

MutualFirst Financial, Inc. operates as the bank holding company for MutualBank that provides various financial services in the United States. It accepts savings deposit, NOW, and demand accounts, as well as certificates of deposit. The company offers one-to four-family residential property, commercial real estate, construction and development, and commercial business loans; consumer loans, such as auto loans, boat and recreational vehicle loans, loans secured by savings deposits, and credit card and unsecured consumer loans; and adjustable rate loans. In addition, it operates as an insurance agent; and sells life and other insurance products. Further, the company provides trust, investment, broker advisory, retirement plan, and private banking products and services. It has 27 full service retail financial centers in Allen, Delaware, Elkhart, Grant, Kosciusko, Randolph, St. Joseph, and Wabash counties in Indiana; and wealth management offices in Fishers and Crawfordsville, Indiana; and 1 loan origination office in New Buffalo, Michigan. MutualFirst Financial, Inc. was founded in 1889 and is headquartered in Muncie, Indiana.

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