The PNC Financial Services Group (NYSE:PNC) and First Northwest Bancorp (NASDAQ:FNWB) Financial Analysis

First Northwest Bancorp (NASDAQ:FNWB) and The PNC Financial Services Group (NYSE:PNC) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, institutional ownership, dividends, profitability, analyst recommendations and earnings.

Analyst Recommendations

This is a summary of current recommendations and price targets for First Northwest Bancorp and The PNC Financial Services Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Northwest Bancorp	0	3	1	0	2.25
The PNC Financial Services Group	0	7	17	0	2.71

First Northwest Bancorp currently has a consensus price target of $15.00, suggesting a potential upside of 53.22%. The PNC Financial Services Group has a consensus price target of $266.13, suggesting a potential upside of 17.86%. Given First Northwest Bancorp’s higher probable upside, research analysts clearly believe First Northwest Bancorp is more favorable than The PNC Financial Services Group.

Dividends

First Northwest Bancorp pays an annual dividend of $0.28 per share and has a dividend yield of 2.9%. The PNC Financial Services Group pays an annual dividend of $8.00 per share and has a dividend yield of 3.5%. First Northwest Bancorp pays out 175.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. The PNC Financial Services Group pays out 42.6% of its earnings in the form of a dividend. The PNC Financial Services Group has increased its dividend for 14 consecutive years. The PNC Financial Services Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

66.1% of First Northwest Bancorp shares are owned by institutional investors. Comparatively, 83.5% of The PNC Financial Services Group shares are owned by institutional investors. 4.1% of First Northwest Bancorp shares are owned by insiders. Comparatively, 0.4% of The PNC Financial Services Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares First Northwest Bancorp and The PNC Financial Services Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Northwest Bancorp	1.32%	0.96%	0.07%
The PNC Financial Services Group	21.83%	12.82%	1.33%

Valuation & Earnings

This table compares First Northwest Bancorp and The PNC Financial Services Group”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	$67.58 million	1.38	-$4.19 million	$0.16	61.19
The PNC Financial Services Group	$25.20 billion	3.58	$6.94 billion	$18.79	12.02

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

Volatility & Risk

First Northwest Bancorp has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500. Comparatively, The PNC Financial Services Group has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500.

Summary

The PNC Financial Services Group beats First Northwest Bancorp on 14 of the 17 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 The PNC Financial Services Group

The PNC Financial Services Group, Inc. operates as a diversified financial services company in the United States. It operates through three segments: Retail Banking, Corporate & Institutional Banking, and Asset Management Group segments. The company's Retail Banking segment offers checking, savings, and money market accounts, as well as time deposit; residential mortgages, home equity loans and lines of credit, auto loans, credit cards, education loans, and personal and small business loans and lines of credit; and brokerage, insurance, and investment and cash management services. This segment serves consumer and small business customers through a network of branches, digital channels, ATMs, and through phone-based customer contact centers. Its Corporate & Institutional Banking segment provides secured and unsecured loans, letters of credit, and equipment leases; cash and investment management services, receivables and disbursement management services, funds transfer services, international payment services, and access to online/mobile information management and reporting; securities underwriting, loan syndications, customer-related trading, and mergers and acquisitions and equity capital markets advisory related services; and commercial loan servicing and technology solutions. It serves mid-sized and large corporations, and government and not-for-profit entities. The company's Asset Management Group segment offers investment and retirement planning, customized investment management, credit and cash management solutions, and trust management and administration services for high net worth and ultra high net worth individuals, and their families; and multi-generational family planning services for ultra high net worth individuals and their families. It also provides outsourced chief investment officer, custody, private real estate, cash and fixed income client solutions, and retirement plan fiduciary investment services for institutional clients. The company was founded in 1852 and is headquartered in Pittsburgh, Pennsylvania.