Contrasting CrossFirst Bankshares (NASDAQ:CFB) & Bankwell Financial Group (NASDAQ:BWFG)

CrossFirst Bankshares (NASDAQ:CFB) and Bankwell Financial Group (NASDAQ:BWFG) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Profitability

This table compares CrossFirst Bankshares and Bankwell Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CrossFirst Bankshares	15.18%	11.06%	1.08%
Bankwell Financial Group	4.76%	3.48%	0.30%

Volatility & Risk

CrossFirst Bankshares has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500. Comparatively, Bankwell Financial Group has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500.

Institutional and Insider Ownership

56.3% of CrossFirst Bankshares shares are owned by institutional investors. Comparatively, 35.8% of Bankwell Financial Group shares are owned by institutional investors. 9.3% of CrossFirst Bankshares shares are owned by insiders. Comparatively, 19.2% of Bankwell Financial Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for CrossFirst Bankshares and Bankwell Financial Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CrossFirst Bankshares	0	0	3	0	3.00
Bankwell Financial Group	0	0	1	0	3.00

CrossFirst Bankshares presently has a consensus target price of $19.33, suggesting a potential upside of 16.78%. Bankwell Financial Group has a consensus target price of $40.00, suggesting a potential upside of 28.68%. Given Bankwell Financial Group’s higher probable upside, analysts plainly believe Bankwell Financial Group is more favorable than CrossFirst Bankshares.

Earnings and Valuation

This table compares CrossFirst Bankshares and Bankwell Financial Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CrossFirst Bankshares	$517.33 million	1.58	$78.55 million	$1.56	10.61
Bankwell Financial Group	$195.71 million	1.25	$9.31 million	$1.18	26.34

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

Summary

CrossFirst Bankshares beats Bankwell Financial Group on 10 of the 13 factors compared between the two stocks.

About CrossFirst Bankshares

CrossFirst Bankshares, Inc. operates as the bank holding company for CrossFirst Bank that provides various banking and financial services to businesses, business owners, professionals, and its personal networks. The company offers commercial and industrial loans, including enterprise value lending; commercial real estate loans; construction and development loans, such as home builder lending; residential real estate, multifamily real estate, energy, SBA, and consumer loans; and credit cards. It also provides deposit banking products, including personal and business checking and savings accounts; treasury management services; money market accounts; certificates of deposits; negotiable order of withdrawal accounts; automated teller machine access; and mobile banking and international banking services, as well as non-interest-bearing demand deposits and interest-bearing deposits, including transaction accounts. In addition, the company acquires brokered deposits, internet subscription certificates of deposit, and reciprocal deposits. Further, it holds investments in marketable securities. The company serves its clients though branch network, as well as digital banking products. It has full-service banking offices in Kansas, Missouri, Oklahoma, Texas, Arizona, Colorado, and New Mexico. CrossFirst Bankshares, Inc. was founded in 2007 and is headquartered in Leawood, Kansas.

About Bankwell Financial Group

Bankwell Financial Group, Inc. operates as the bank holding company for Bankwell Bank that provides various banking services for individual and commercial customers. It offers various traditional depository products, including checking, savings, money market, and certificates of deposit. The company also provides first mortgage loans secured by one-to-four family owner occupied residential properties for personal use; home equity loans and home equity lines of credit secured by owner occupied one-to-four family residential properties; loans secured by commercial real estate, multi-family dwellings, owner-occupied commercial real estate, and investor-owned one-to-four family dwellings; commercial construction loans for commercial development projects, including apartment buildings and condominiums, as well as office buildings, retail, and other income producing properties; land loans; commercial business loans secured by assignments of corporate assets and personal guarantees of the business owners; loans to finance insurance premiums; overdraft lines of credit; and unsecured personal loans. It operates branches in New Canaan, Stamford, Fairfield, Westport, Darien, Norwalk, and Hamden, Connecticut. The company was formerly known as BNC Financial Group, Inc. and changed its name to Bankwell Financial Group, Inc. in September 2013. Bankwell Financial Group, Inc. was founded in 2002 and is headquartered in New Canaan, Connecticut.