Analyzing WaFd (NASDAQ:WAFD) & First United (NASDAQ:FUNC)

WaFd (NASDAQ:WAFD) and First United (NASDAQ:FUNC) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, profitability, risk and valuation.

Volatility & Risk

WaFd has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500. Comparatively, First United has a beta of 0.81, suggesting that its stock price is 19% less volatile than the S&P 500.

Profitability

This table compares WaFd and First United’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
WaFd	12.66%	8.78%	0.82%
First United	18.45%	12.51%	1.11%

Dividends

WaFd pays an annual dividend of $1.04 per share and has a dividend yield of 3.5%. First United pays an annual dividend of $0.88 per share and has a dividend yield of 2.2%. WaFd pays out 47.9% of its earnings in the form of a dividend. First United pays out 27.9% 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.

Insider and Institutional Ownership

83.7% of WaFd shares are owned by institutional investors. Comparatively, 33.3% of First United shares are owned by institutional investors. 1.5% of WaFd shares are owned by company insiders. Comparatively, 7.8% of First United shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations for WaFd and First United, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WaFd	0	4	0	0	2.00
First United	0	0	1	0	3.00

WaFd presently has a consensus target price of $33.75, indicating a potential upside of 12.39%. First United has a consensus target price of $42.00, indicating a potential upside of 2.84%. Given WaFd’s higher possible upside, research analysts clearly believe WaFd is more favorable than First United.

Earnings & Valuation

This table compares WaFd and First United”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
WaFd	$1.43 billion	1.71	$200.04 million	$2.17	13.84
First United	$79.79 million	3.31	$20.57 million	$3.15	12.97

WaFd has higher revenue and earnings than First United. First United is trading at a lower price-to-earnings ratio than WaFd, indicating that it is currently the more affordable of the two stocks.

Summary

First United beats WaFd on 9 of the 16 factors compared between the two stocks.

About WaFd

WaFd, Inc operates as the bank holding company for Washington Federal Bank that provides lending, depository, insurance, and other banking services in the United States. The company offers 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 dwellings, construction, land acquisition and development, consumer lot, multi-family residential, commercial real estate, home equity, business, and consumer loans, as well as commercial and industrial loans. In addition, the company offers insurance brokerage services, such as individual and business insurance policies; holds and markets real estate properties; and debit and credit cards, as well as acts as the trustee. It serves consumers, mid-sized and large businesses, and owners and developers of commercial real estate. The company was formerly known as Washington Federal, Inc. and changed its name to WaFd, Inc in September 2023. WaFd, Inc was founded in 1917 and is headquartered in Seattle, Washington.

About First United

First United Corporation operates as the bank holding company for First United Bank & Trust that provides various retail and commercial banking services to businesses and individuals. It offers various deposit products, which includes checking, savings, money market deposit, and regular and individual retirement accounts (IRAs), as well as certificates of deposit. The company loan portfolio includes commercial loans secured by real estate, commercial equipment, vehicles, or other assets of the borrower; commercial real estate loans for residential and commercial development, agricultural purpose properties, and service industry buildings, such as restaurants and motels, retail buildings, and general purpose business space; residential mortgage loans; home equity lines of credit; residential real estate construction loans; and indirect and direct auto loans, student loans, and other secured and unsecured lines of credit and term loans. It also offers access to multi-million-dollar certificates of deposit and the Intrafi cash service, including multi-million-dollar savings and demand deposits to municipalities, businesses, and consumers; and treasury management, cash sweep, and various checking services. In addition, the company provides trust services, which includes personal trust, investment agency accounts, charitable trusts, retirement accounts, including IRA roll-overs, 401(k) accounts and defined benefit plans, estate administration, and estate planning; and insurance products, brokerage services, and safe deposit and night depository facilities. First United Corporation was founded in 1900 and is headquartered in Oakland, Maryland.