Head-To-Head Analysis: Flagstar Financial (NYSE:FLG) vs. Northeast Community Bancorp (NASDAQ:NECB)

Northeast Community Bancorp (NASDAQ:NECB) and Flagstar Financial (NYSE:FLG) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, analyst recommendations, valuation and institutional ownership.

Analyst Recommendations

This is a summary of recent recommendations for Northeast Community Bancorp and Flagstar Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northeast Community Bancorp	0	0	0	0	0.00
Flagstar Financial	0	3	0	0	2.00

Flagstar Financial has a consensus price target of $11.50, indicating a potential upside of 4.26%. Given Flagstar Financial’s stronger consensus rating and higher possible upside, analysts plainly believe Flagstar Financial is more favorable than Northeast Community Bancorp.

Profitability

This table compares Northeast Community Bancorp and Flagstar Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northeast Community Bancorp	30.47%	16.63%	2.60%
Flagstar Financial	-18.40%	-11.35%	-0.78%

Dividends

Northeast Community Bancorp pays an annual dividend of $0.60 per share and has a dividend yield of 2.4%. Flagstar Financial pays an annual dividend of $0.04 per share and has a dividend yield of 0.4%. Northeast Community Bancorp pays out 16.8% of its earnings in the form of a dividend. Flagstar Financial pays out -0.9% 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.

Volatility and Risk

Northeast Community Bancorp has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500. Comparatively, Flagstar Financial has a beta of 1.09, suggesting that its stock price is 9% more volatile than the S&P 500.

Valuation and Earnings

This table compares Northeast Community Bancorp and Flagstar Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northeast Community Bancorp	$106.15 million	3.31	$46.28 million	$3.58	6.99
Flagstar Financial	$2.93 billion	1.56	-$79.00 million	($4.36)	-2.53

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

Institutional & Insider Ownership

53.3% of Northeast Community Bancorp shares are owned by institutional investors. Comparatively, 67.9% of Flagstar Financial shares are owned by institutional investors. 4.7% of Northeast Community Bancorp shares are owned by company insiders. Comparatively, 6.4% of Flagstar Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Northeast Community Bancorp beats Flagstar Financial on 8 of the 15 factors compared between the two stocks.

About Northeast Community Bancorp

Northeast Community Bancorp, Inc. operates as the holding company for NorthEast Community Bank that provides financial services for individuals and businesses. It accepts various deposit instruments, including checking accounts, money market accounts, regular savings accounts, and non-interest bearing demand accounts, as well as certificates of deposits. The company also offers construction, commercial and industrial, multifamily and mixed-use real estate, non-residential real estate loans, and consumer loans. In addition, it invests in various types of liquid assets, including U.S. Treasury obligations, municipal securities, deposits at the Federal Home Loan Bank of New York, and certificates of deposit of federally insured institutions, as well as securities of various federal agencies, and of state and municipal governments. Further, the company offers financial planning and investment advisory services; and life insurance products and fixed-rate annuities. It operates full-service branches located in Bronx, New York, Orange, Rockland, and Sullivan Counties in New York and Essex, Middlesex, and Norfolk Counties in Massachusetts; and loan production offices located in White Plains, New York, and New City counties in New York and Danvers, Massachusetts. Northeast Community Bancorp, Inc. was founded in 1934 and is headquartered in White Plains, New York.

About Flagstar Financial

Flagstar Financial, Inc. operates as the bank holding company for Flagstar Bank, N.A. that provides banking products and services in the United States. The company’s deposit products include interest-bearing checking and money market, savings, non-interest-bearing, and retirement accounts, as well as certificates of deposit. Its loan products comprise multi-family loans; commercial real estate loans; acquisition, development, and construction loans; commercial and industrial loans; one-to-four family loans; specialty finance loans and leases; warehouse loans; and other loans, such as home equity lines of credit, boat and recreational vehicle indirect lending, point of sale consumer loans, and other consumer loans, including overdraft loans. The company offers cash management products; non-deposit investment and insurance products; and online banking, mobile banking, and bank-by-phone services. It primarily serves individuals, small and mid-size businesses, and professional associations. The company was formerly known as New York Community Bancorp, Inc. and changed its name to Flagstar Financial, Inc. in October 2024. Flagstar Financial, Inc. was founded in 1859 and is headquartered in Hicksville, New York.