Critical Analysis: Hudson City Bancorp (HCBK) and Yadkin Financial Corp (YDKN)

Yadkin Financial Corp (NYSE: YDKN) and Hudson City Bancorp (NASDAQ:HCBK) are both financials companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, dividends, risk, institutional ownership, valuation, profitability and analyst recommendations.

Analyst Recommendations

This is a summary of current ratings for Yadkin Financial Corp and Hudson City Bancorp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Yadkin Financial Corp 0 1 0 0 2.00
Hudson City Bancorp 0 0 0 0 N/A

Yadkin Financial Corp presently has a consensus target price of $27.00, suggesting a potential downside of 21.69%. Given Yadkin Financial Corp’s higher probable upside, research analysts plainly believe Yadkin Financial Corp is more favorable than Hudson City Bancorp.

Profitability

This table compares Yadkin Financial Corp and Hudson City Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Yadkin Financial Corp 18.40% 5.41% 0.75%
Hudson City Bancorp 28.49% 2.98% 0.40%

Insider and Institutional Ownership

69.7% of Yadkin Financial Corp shares are owned by institutional investors. 3.0% of Yadkin Financial Corp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Yadkin Financial Corp pays an annual dividend of $0.40 per share and has a dividend yield of 1.2%. Hudson City Bancorp does not pay a dividend. Yadkin Financial Corp pays out 32.5% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares Yadkin Financial Corp and Hudson City Bancorp’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Yadkin Financial Corp N/A N/A N/A $1.23 28.03
Hudson City Bancorp N/A N/A N/A N/A N/A

Summary

Yadkin Financial Corp beats Hudson City Bancorp on 6 of the 8 factors compared between the two stocks.

About Yadkin Financial Corp

Yadkin Financial Corporation is a bank holding company. The Company conducts its business operations through its subsidiary, Yadkin Bank, which is a chartered community bank that provides services in approximately 110 branches across North Carolina and South Carolina. Yadkin Bank provides banking, mortgage, investment and insurance services to businesses and consumers across the Carolinas. It operates through a segment, which is providing general commercial banking and financial services to individuals and businesses located in North Carolina and South Carolina, and to customers in various states through its Small Business Administration (SBA) lending program. It offers various loans, such as commercial and industrial (C&I) loans and government-guaranteed loans. The Company’s investment securities portfolio includes the United States Government-sponsored enterprise (GSE) obligations and securities guaranteed by the United States SBA. The Company’s primary source of funds is deposits.

About Hudson City Bancorp

Hudson City Bancorp, Inc. serves as the holding company of its subsidiary, Hudson City Savings Bank (the Bank). The Bank is a federal stock savings bank. The Company is a community and consumer-oriented retail savings bank offering traditional deposit products, residential real estate mortgage loans and consumer loans. In addition, it purchases residential mortgages, commercial real estate mortgages and interests in such loans and mortgage-backed securities and other securities issued by the United States government-sponsored enterprises (GSEs), as well as other investments permitted by applicable laws and regulations. The Company has two wholly owned and consolidated subsidiaries, including HudCiti Service Corporation and HC Value Broker Services, Inc.

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