Northfield Bancorp, Inc. (New Jersey) – Value Analysis (NASDAQ:NFBK) : July 3, 2017

Capitalcube gives Northfield Bancorp, Inc. (New Jersey) a score of 43.

Our analysis is based on comparing Northfield Bancorp, Inc. (New Jersey) with the following peers – Flushing Financial Corporation, Greene County Bancorp, Inc., Dime Community Bancshares, Inc. and Astoria Financial Corporation (FFIC-US, GCBC-US, DCOM-US and AF-US).

Fundamental Overview

Northfield Bancorp, Inc. (New Jersey) has a fundamental score of 43 and has a relative valuation of OVERVALUED.

Fundamental Score

Company Overview

  • It’s current Price/Book of 1.33 is about median in its peer group.
  • The market expects NFBK-US to grow at about the same rate as the peers and to maintain the median returns it currently generates.
  • NFBK-US employs relatively high amounts of capital while generating median profit margins.
  • Change in the company’s annual revenues seems to be coming at the expense of earnings.
  • NFBK-US‘s return on equity has improved from below median to about median among its peers over the last five years.
  • While NFBK-US‘s revenues in recent years have grown faster than the peer median, the market gives the stock a P/E ratio that is around peer median suggesting that the market has some questions about the company’s long-term strategy.
  • The company’s relatively low level of equity capital investment and below peer median returns on capital suggest that the company is in maintenance mode.

Drivers of Margin

  • Margins do not suggest any relative benefit from a pricing or an operating cost advantage.
  • The company’s net interest income (net interest income/total revenues) of 89.77% is around peer median suggesting that NFBK-US‘s lending operations does not benefit from any differentiating pricing advantage. In addition, NFBK-US‘s pre-tax margin of 40.18% is also around the peer median suggesting no operating cost advantage relative to peers.
  • The company’s proportion of fee based income (i.e. non interest income/total revenues) of 10.23% is around peer median. In addition, NFBK-US‘s proportion of overhead costs (i.e. non interest expense/total revenues) of 58.84x is also around peer median — suggesting no cost advantage on fee-based overhead operations.
Drivers of Margins

Quadrant label definitions. Hover to know more

Differentiated; Low Cost, Differentiated; High Cost, Commodity; High Cost, Commodity; Low Cost

Company Profile

Northfield Bancorp, Inc. engages in the provision of banking and financial services. Its principal business consists of gathering deposits, and to a lesser extent, borrowing funds, and using such funds to originate multifamily real estate loans and commercial real estate loans, purchase investment securities including mortgage-backed securities and corporate bonds, as well as deposit funds in other financial institutions. The Company also offers construction and land loans, commercial and industrial loans, one- to four-family residential mortgage loans, and home equity loans and lines of credit. Northfield Bancorp was founded on March 01, 1887 and is headquartered in Woodbridge, NJ.