Critical Survey: Citizens Bancshares (OTCMKTS:CZBS) and Flushing Financial (NASDAQ:FFIC)

Flushing Financial (NASDAQ:FFIC) and Citizens Bancshares (OTCMKTS:CZBS) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, risk, earnings, dividends, analyst recommendations, institutional ownership and valuation.

Insider and Institutional Ownership

67.1% of Flushing Financial shares are owned by institutional investors. 6.3% of Flushing Financial shares are owned by insiders. Comparatively, 10.2% of Citizens Bancshares shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Flushing Financial pays an annual dividend of $0.88 per share and has a dividend yield of 6.0%. Citizens Bancshares pays an annual dividend of $1.00 per share and has a dividend yield of 2.1%. Flushing Financial pays out 88.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Flushing Financial and Citizens Bancshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Flushing Financial	0	3	1	0	2.25
Citizens Bancshares	0	0	0	0	N/A

Flushing Financial presently has a consensus price target of $15.50, suggesting a potential upside of 6.16%. Given Flushing Financial’s higher possible upside, research analysts plainly believe Flushing Financial is more favorable than Citizens Bancshares.

Valuation & Earnings

This table compares Flushing Financial and Citizens Bancshares’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Flushing Financial	$193.70 million	2.19	$28.66 million	$1.00	14.60
Citizens Bancshares	N/A	N/A	N/A	N/A	N/A

Flushing Financial has higher revenue and earnings than Citizens Bancshares.

Profitability

This table compares Flushing Financial and Citizens Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Flushing Financial	5.84%	3.96%	0.31%
Citizens Bancshares	N/A	N/A	N/A

Risk & Volatility

Flushing Financial has a beta of 0.77, indicating that its stock price is 23% less volatile than the S&P 500. Comparatively, Citizens Bancshares has a beta of 0.54, indicating that its stock price is 46% less volatile than the S&P 500.

Summary

Flushing Financial beats Citizens Bancshares on 9 of the 11 factors compared between the two stocks.

About Flushing Financial

Flushing Financial Corporation operates as the bank holding company for Flushing Bank that provides banking products and services primarily to consumers, businesses, and governmental units. It offers various deposit products, including checking and savings accounts, money market accounts, non-interest bearing demand accounts, NOW accounts, and certificates of deposit. The company also provides mortgage loans secured by multi-family residential, commercial real estate, one-to-four family mixed-use property, one-to-four family residential property, and commercial business loans; construction loans; small business administration loans and other small business loans; mortgage loan surrogates, such as mortgage-backed securities; and consumer loans, including overdraft lines of credit, as well as the United States government securities, corporate fixed-income securities, and other marketable securities. It operates full-service banking offices in Queens, Nassau, Suffolk, Kings, and New York counties, New York; and an internet branch under the iGObanking and BankPurely brands. Flushing Financial Corporation was founded in 1929 and is based in Uniondale, New York.

About Citizens Bancshares

Citizens Bancshares Corporation operates as the holding company for Citizens Trust Bank that provides various commercial banking services to individual and corporate customers. The company offers checking and savings accounts; and demand and money market deposits. Its loan products include commercial, financial, and agricultural loans; loans secured by personal property, such as automobiles, marketable securities, and other titled recreational vehicles and motorcycles, as well as unsecured consumer debt; commercial real estate loans; single-family residential loans; and construction and development loans. The company also offers investment accounts and certificate of deposit account registry services. In addition, it provides merchant services, which include point of sale terminal, credit and debit card processing, electronic benefits transfer, gift card, and Internet shopping cart services; cash management services; and credit cards. Further, the company offers online and mobile banking, as well as check reorder services. Citizens Bancshares Corporation was founded in 1921 and is headquartered in Atlanta, Georgia.