Ranking The Dividend Challengers, Part 9

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Includes: COLB, FCBI, FDEF, FXCB, ISBC, NWBI, PFS, PROV, WAFD, WAYN
by: Stan Stafford

Summary

Dividend Challengers are stocks that have 5+ years of increased dividends. It is part of the U.S. Dividend Champions list maintained by Dave Fish.

In this series of articles, I will be ranking the Dividend Challengers of various industry sectors based on 15 different metrics.

Out of this group of stocks, my top picks are First Defiance Financial, Columbia Banking System, and Investors Bancorp.

Overview

In this series of articles, I will be ranking the Dividend Challengers of various industry sectors based on 15 different metrics. Dividend Challengers are stocks that have 5+ years of consecutive dividend growth. The stocks are part of the U.S. Dividend Champions list that is maintained by Dave Fish.

For part 9 of this series, I will be reviewing the Dividend Challengers that are in the Banking industry focus on Savings & Loans institutions. These stocks include:

  • Columbia Banking System (NASDAQ:COLB)
  • First Defiance Financial (NASDAQ:FDEF)
  • Fox Chase Bancorp (NASDAQ:FXCB)
  • Frederick County Bancorp (OTCPK:FCBI)
  • Investors Bancorp (NASDAQ:ISBC)
  • Northwest Bancshares (NASDAQ:NWBI)
  • Provident Financial Holdings (NASDAQ:PROV)
  • Provident Financial Services (NYSE:PFS)
  • Washington Federal (NASDAQ:WAFD)
  • Wayne Savings Bancshares (NASDAQ:WAYN)

These stocks will be ranked based on the following 15 metrics:

  • Dividend Yield
  • Dividend Growth (past five years)
  • Payout Ratio
  • Revenue Growth (past five years)
  • Earnings Growth (past five years)
  • Book Value Growth (past five years)
  • Stock Price Appreciation (past five years)
  • PEG ratio (trailing twelve months)
  • Price to Free Cash Flow ratio (trailing twelve months)
  • Return on Assets (trailing twelve months)
  • Return on Equity (trailing twelve months)
  • Return on Invested Capital (trailing twelve months)
  • Earnings Yield
  • Debt to Equity ratio (trailing twelve months)
  • Price to Book value (trailing twelve months)

Dividend Yield

Stock Value Ranking
Columbia Banking System 2.57% 6
First Defiance Financial 2.08% 8
Fox Chase Bancorp 2.86% 3
Frederick County Bancorp 1.26% 10
Investors Bancorp 1.89% 9
Northwest Bancshares 4.07% 1
Provident Financial Holdings 2.64% 5
Provident Financial Services 3.34% 2
Washington Federal 2.21% 7
Wayne Savings Bancshares 2.71% 4

Dividend Growth

Stock Value Ranking
Columbia Banking System 640.0% 2
First Defiance Financial 340.0% 4
Fox Chase Bancorp 600.0% 3
Frederick County Bancorp 40.00% 9
Investors Bancorp 206.0% 5
Northwest Bancshares 36.36% 10
Provident Financial Holdings 1.10K% 1
Provident Financial Services 50.00% 7.5
Washington Federal 133.3% 6
Wayne Savings Bancshares 50.00% 7.5

Payout Ratio

Stock Value Ranking
Columbia Banking System 85.78% 9
First Defiance Financial 27.09% 2
Fox Chase Bancorp 79.67% 8
Frederick County Bancorp 20.07% 1
Investors Bancorp 48.15% 5
Northwest Bancshares 87.26% 10
Provident Financial Holdings 47.80% 4
Provident Financial Services 49.31% 6
Washington Federal 30.97% 3
Wayne Savings Bancshares 60.11% 7

Revenue Growth

Stock Value Ranking
Columbia Banking System 102.2% 1
First Defiance Financial 9.34% 5
Fox Chase Bancorp 7.68% 6
Frederick County Bancorp 12.05% 4
Investors Bancorp 93.31% 2
Northwest Bancshares 5.92% 8
Provident Financial Holdings (6.35%) 10
Provident Financial Services 26.38% 3
Washington Federal 7.42% 7
Wayne Savings Bancshares (4.25%) 9

Earnings Growth

Stock Value Ranking
Columbia Banking System 120.8% 4
First Defiance Financial 160.7% 2
Fox Chase Bancorp 191.7% 1
Frederick County Bancorp 42.91% 7
Investors Bancorp 121.7% 3
Northwest Bancshares 15.20% 8
Provident Financial Holdings (24.0%) 10
Provident Financial Services 44.65% 6
Washington Federal 96.57% 5
Wayne Savings Bancshares (15.8%) 9

Book Value Growth

Stock Value Ranking
Columbia Banking System 63.29% 2
First Defiance Financial 16.03% 4
Fox Chase Bancorp (5.99%) 10
Frederick County Bancorp 3.14% 5
Investors Bancorp 242.3% 1
Northwest Bancshares 0.72% 7
Provident Financial Holdings (0.43%) 9
Provident Financial Services 25.57% 3
Washington Federal 2.58% 6
Wayne Savings Bancshares 0.30% 8

Stock Price Appreciation

Stock Value Ranking
Columbia Banking System 57.87% 6
First Defiance Financial 175.2% 1
Fox Chase Bancorp 46.78% 8
Frederick County Bancorp 53.10% 7
Investors Bancorp 103.7% 3
Northwest Bancshares 16.41% 10
Provident Financial Holdings 125.7% 2
Provident Financial Services 41.20% 9
Washington Federal 58.57% 4
Wayne Savings Bancshares 58.33% 5

PEG Ratio

Stock Value Ranking
Columbia Banking System 2.84x 9
First Defiance Financial 1.21x 4
Fox Chase Bancorp 1.66x 7
Frederick County Bancorp 0.51x 2
Investors Bancorp 0.46x 1
Northwest Bancshares 7.22x 10
Provident Financial Holdings 1.50x 5
Provident Financial Services 1.62x 6
Washington Federal 2.18x 8
Wayne Savings Bancshares 1.11x 3

Price to Free Cash Flow Ratio

Stock Value Ranking
Columbia Banking System 12.18x 6
First Defiance Financial 12.60x 7
Fox Chase Bancorp 21.46x 10
Frederick County Bancorp 10.86x 4
Investors Bancorp 7.62x 2
Northwest Bancshares 12.94x 8
Provident Financial Holdings 2.60x 1
Provident Financial Services 11.72x 5
Washington Federal 13.85x 9
Wayne Savings Bancshares 10.01x 3

Return on Assets

Stock Value Ranking
Columbia Banking System 1.09% 2.5
First Defiance Financial 1.19% 1
Fox Chase Bancorp 0.85% 6
Frederick County Bancorp 0.48% 9
Investors Bancorp 0.90% 5
Northwest Bancshares 0.73% 7
Provident Financial Holdings 0.63% 8
Provident Financial Services 0.96% 4
Washington Federal 1.09% 2.5
Wayne Savings Bancshares 0.39% 10

Return on Equity

Stock Value Ranking
Columbia Banking System 7.69% 3
First Defiance Financial 9.69% 1
Fox Chase Bancorp 5.41% 8
Frederick County Bancorp 5.74% 5
Investors Bancorp 5.43% 7
Northwest Bancshares 5.54% 6
Provident Financial Holdings 5.32% 9
Provident Financial Services 7.17% 4
Washington Federal 8.07% 2
Wayne Savings Bancshares 4.13% 10

Return on Invested Capital

Stock Value Ranking
Columbia Banking System 7.48% 1
First Defiance Financial 7.14% 2
Fox Chase Bancorp 2.75% 8
Frederick County Bancorp 3.34% 4
Investors Bancorp 2.72% 9
Northwest Bancshares 2.89% 7
Provident Financial Holdings 3.10% 5
Provident Financial Services 3.01% 6
Washington Federal 4.14% 3
Wayne Savings Bancshares 2.54% 10

Earnings Yield

Stock Value Ranking
Columbia Banking System 5.85% 4
First Defiance Financial 7.40% 1
Fox Chase Bancorp 4.34% 10
Frederick County Bancorp 4.39% 9
Investors Bancorp 4.89% 5
Northwest Bancshares 4.51% 7
Provident Financial Holdings 4.68% 6
Provident Financial Services 6.84% 3
Washington Federal 6.93% 2
Wayne Savings Bancshares 4.48% 8

Debt to Equity Ratio

Stock Value Ranking
Columbia Banking System 0.06x 1
First Defiance Financial 0.34x 2
Fox Chase Bancorp 1.01x 9
Frederick County Bancorp 0.72x 5
Investors Bancorp 0.99x 8
Northwest Bancshares 0.93x 6
Provident Financial Holdings 0.65x 3
Provident Financial Services 1.43x 10
Washington Federal 0.94x 7
Wayne Savings Bancshares 0.67x 4

Price to Book Value

Stock Value Ranking
Columbia Banking System 1.31x 10
First Defiance Financial 1.26x 7.5
Fox Chase Bancorp 1.30x 9
Frederick County Bancorp 1.26x 7.5
Investors Bancorp 1.19x 5
Northwest Bancshares 1.24x 6
Provident Financial Holdings 1.12x 3
Provident Financial Services 1.07x 2
Washington Federal 1.13x 4
Wayne Savings Bancshares 0.93x 1

Final Rankings

The Heavyweights

  • First Defiance Financial - Total Score of 51.5
  • Columbia Banking System - Total Score of 66.5
  • Investors Bancorp - Total Score of 70

The Middleweights

  • Washington Federal - Total Score of 75.5
  • Provident Financial Services - Total Score of 76.5
  • Provident Financial Holdings - Total Score of 81
  • Frederick County Bancorp - Total Score of 88.5

The LightWeights

  • Wayne Savings Bancshares - Total Score of 98.5
  • Fox Chase Bancorp - Total Score of 106
  • Northwest Bancshares - Total Score of 111

Conclusion

Out of this group of stocks, First Defiance Financial had the best overall score by a wide margin, with Columbia Banking and Investors Bancorp also have strong results.

First Defiance Financial had the best actual stock price performance over the past five years and also ranked #1 in three other metrics, while ranking #2 in four additional metrics. For its last quarter, First Defiance saw a 6% increase in revenue and an increase in earnings per share from $0.69 to $0.78 compared to the same period last year. With strong loan and deposit growth along with a significant decline in non-performing assets, First Defiance should continue providing strong total returns for investors.

Columbia Banking Systems didn't have a great quarter as its revenue and net income declined compared to the same period last year. However, the overall fundamentals remain strong as deposit growth and asset quality remain strong. Columbia recently increased its regular dividend by 6% and has paid a special dividend for nine consecutive quarters.

For its most recent quarter, Investors Bancorp had a 7% increase in revenue and an increase in earnings per share from $0.12 to $0.14 compared to the same period last year. The company remains fundamentally sound and should continue to deliver strong results (average annual return of 8.81% over the past ten years).

Out of the middleweight stocks, I would only recommend the first two at the moment (Washington Federal and Provident Financial Services). Frederick County has significantly lower dividend yield/growth and hasn't shown enough in terms of solid returns and stock price appreciation to make this up in my opinion. Provident Financial Holdings has shown solid stock price returns, but recently has seen a decline (down 4.76% YTD) and has seen negative revenue and earnings growth over the past five years.

I don't believe the lightweight stocks should be purchased at the moment. While they do offer solid dividend yields, overall poor fundamentals and growth keep me from recommending them as possible buys. As always, I suggest individual investors perform their own research before making any investment decisions.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.