First Niagara Financial Group (NASDAQ: FNFG) and First Connecticut Bancorp (NASDAQ:FBNK) are both financials companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, dividends, analyst recommendations, risk, profitability, institutional ownership and earnings.

Analyst Ratings

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This is a breakdown of current recommendations and price targets for First Niagara Financial Group and First Connecticut Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Niagara Financial Group 0 0 0 0 N/A
First Connecticut Bancorp 0 0 1 0 3.00

First Connecticut Bancorp has a consensus target price of $26.00, suggesting a potential downside of 3.88%. Given First Connecticut Bancorp’s higher probable upside, analysts clearly believe First Connecticut Bancorp is more favorable than First Niagara Financial Group.

Dividends

First Niagara Financial Group pays an annual dividend of $0.32 per share and has a dividend yield of 3.1%. First Connecticut Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 2.4%. First Niagara Financial Group pays out 65.3% of its earnings in the form of a dividend. First Connecticut Bancorp pays out 62.7% 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.

Profitability

This table compares First Niagara Financial Group and First Connecticut Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Niagara Financial Group 14.04% 4.06% 0.47%
First Connecticut Bancorp 14.46% 7.85% 0.71%

Institutional and Insider Ownership

47.3% of First Connecticut Bancorp shares are held by institutional investors. 10.7% of First Connecticut Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares First Niagara Financial Group and First Connecticut Bancorp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Niagara Financial Group N/A N/A N/A $0.49 20.78
First Connecticut Bancorp $111.98 million 3.85 $16.19 million $1.02 26.52

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

Summary

First Connecticut Bancorp beats First Niagara Financial Group on 11 of the 12 factors compared between the two stocks.

About First Niagara Financial Group

First Niagara Financial Group Inc. is a bank holding company for First Niagara Bank, N.A. (the Bank). The Bank is engaged in providing financial services to individuals and businesses in New York, Western and Eastern Pennsylvania, Connecticut, and Western Massachusetts. The Bank is a nationally chartered regional bank providing financial services to individuals, families and businesses. The Bank operates through two segments: banking and financial services. The banking segment includes all of its retail and commercial banking operations. The financial services segment includes its insurance operations. Its financial services activities consist predominantly of insurance sales. Its financial services activities consist of insurance sales. The Bank provides a range of products and services through its retail consumer, commercial, business services and wealth management operations, including retail banking, cash management, insurance and wealth management products.

About First Connecticut Bancorp

First Connecticut Bancorp, Inc. (FCB) is a stock holding company. The Company operates through its subsidiary, Farmington Bank (the Bank), which is a full-service community bank with branch locations throughout central Connecticut and western Massachusetts. The Bank offers commercial and residential lending, as well as wealth management services. The Bank’s lending activities include residential, consumer and commercial lending. The Bank’s lending activities consists of the origination of one- to four-family residential real estate loans that are secured by properties located in Hartford County and surrounding counties in Connecticut. The Company offers a selection of deposit instruments, including checking, savings, money market savings accounts, negotiable order of withdrawal (NOW) accounts and fixed-rate time deposits.

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