Head to Head Comparison: Washington Federal (NASDAQ:WAFD) versus CHESAPEAKE FINL/SH (NASDAQ:CPKF)

Washington Federal (NASDAQ:WAFD) and CHESAPEAKE FINL/SH (OTCMKTS:CPKF) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, valuation, earnings, risk, dividends, analyst recommendations and profitability.

Analyst Ratings

This is a summary of recent recommendations for Washington Federal and CHESAPEAKE FINL/SH, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Washington Federal 0 1 0 0 2.00
CHESAPEAKE FINL/SH 0 0 0 0 N/A

Washington Federal currently has a consensus target price of $34.00, suggesting a potential downside of 2.44%. Given Washington Federal’s higher probable upside, equities research analysts clearly believe Washington Federal is more favorable than CHESAPEAKE FINL/SH.

Profitability

This table compares Washington Federal and CHESAPEAKE FINL/SH’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Washington Federal 29.19% 10.47% 1.29%
CHESAPEAKE FINL/SH 18.67% 11.78% 1.29%

Institutional & Insider Ownership

83.6% of Washington Federal shares are held by institutional investors. Comparatively, 3.0% of CHESAPEAKE FINL/SH shares are held by institutional investors. 1.2% of Washington Federal shares are held by company insiders. Comparatively, 39.5% of CHESAPEAKE FINL/SH shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

Washington Federal pays an annual dividend of $0.80 per share and has a dividend yield of 2.3%. CHESAPEAKE FINL/SH pays an annual dividend of $0.58 per share and has a dividend yield of 2.2%. Washington Federal pays out 33.3% of its earnings in the form of a dividend. CHESAPEAKE FINL/SH pays out 22.2% 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. Washington Federal has raised its dividend for 5 consecutive years. Washington Federal is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Washington Federal has a beta of 1.15, meaning that its stock price is 15% more volatile than the S&P 500. Comparatively, CHESAPEAKE FINL/SH has a beta of 0.49, meaning that its stock price is 51% less volatile than the S&P 500.

Valuation & Earnings

This table compares Washington Federal and CHESAPEAKE FINL/SH’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Washington Federal $651.16 million 4.31 $203.85 million $2.40 14.52
CHESAPEAKE FINL/SH $51.05 million 2.12 $10.82 million $2.61 10.11

Washington Federal has higher revenue and earnings than CHESAPEAKE FINL/SH. CHESAPEAKE FINL/SH is trading at a lower price-to-earnings ratio than Washington Federal, indicating that it is currently the more affordable of the two stocks.

Summary

Washington Federal beats CHESAPEAKE FINL/SH on 10 of the 14 factors compared between the two stocks.

Washington Federal Company Profile

Washington Federal, Inc. operates as the bank holding company for Washington Federal, National Association that provides lending, depository, insurance, and other banking services in the United States. The company accepts deposit products, including business and personal checking accounts, and term certificates of deposit, as well as money market accounts and passbook savings accounts. It also provides single-family residential, construction, land acquisition and development, land consumer lot, multi-family residential, commercial and industrial, commercial real estate, home equity, business, and consumer loans. In addition, the company offers insurance brokerage services, such as individual and business insurance policies to customers and general public; holds and markets real estate properties; and acts as trustee. It serves consumers, mid-sized and large businesses, and owners and developers of commercial real estate. As of September 30, 2018, the company had 235 branches located in Washington, Oregon, Idaho, Arizona, Utah, Nevada, New Mexico, and Texas. Washington Federal, Inc. was founded in 1917 and is headquartered in Seattle, Washington.

CHESAPEAKE FINL/SH Company Profile

Chesapeake Financial Shares, Inc. operates as the bank holding company for Chesapeake Bank that provides various banking products and services for corporate and individual clients in Virginia. It operates through Commercial, Commercial – Real Estate, Consumer – Non Real Estate, and Residential – Real Estate segments. The company offers interest and noninterest checking, savings, and money market accounts, as well as certificates of deposit. It also provides mortgage loans, single-family residential and residential construction loans, lines of credit, and consumer loans; and commercial loans, including owner-occupied commercial development, retail, builders/contractors, medical, service and professional, hospitality, nonprofits, marine industry, and agricultural and seafood loans. In addition, the company offers merchant processing services, accounts receivable financing, wealth management and trust, and cash management services. It operates through 15 branches, including 4 in Northern Neck, 3 in Middle Peninsula, 5 in Williamsburg, and 3 in Richmond. The company was founded in 1900 and is based in Kilmarnock, Virginia.

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