Head-To-Head Analysis: HMN Financial (NASDAQ:HMNF) vs. TC Bancshares (NASDAQ:TCBC)

HMN Financial (NASDAQ:HMNF) and TC Bancshares (NASDAQ:TCBC) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, valuation, earnings, institutional ownership, analyst recommendations, risk and profitability.

Analyst Recommendations

This is a summary of recent recommendations for HMN Financial and TC Bancshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HMN Financial	0	0	0	0	N/A
TC Bancshares	0	0	0	0	N/A

Earnings & Valuation

This table compares HMN Financial and TC Bancshares’ revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HMN Financial	$51.76 million	1.86	$6.01 million	$1.29	16.67
TC Bancshares	$21.97 million	2.59	$270,000.00	N/A	N/A

HMN Financial has higher revenue and earnings than TC Bancshares.

Profitability

This table compares HMN Financial and TC Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HMN Financial	10.57%	5.41%	0.50%
TC Bancshares	-0.19%	-0.05%	-0.01%

Volatility & Risk

HMN Financial has a beta of 0.19, meaning that its share price is 81% less volatile than the S&P 500. Comparatively, TC Bancshares has a beta of 0.05, meaning that its share price is 95% less volatile than the S&P 500.

Institutional & Insider Ownership

78.3% of HMN Financial shares are held by institutional investors. Comparatively, 23.6% of TC Bancshares shares are held by institutional investors. 8.2% of HMN Financial shares are held by insiders. Comparatively, 9.6% of TC Bancshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

HMN Financial pays an annual dividend of $0.40 per share and has a dividend yield of 1.9%. TC Bancshares pays an annual dividend of $0.10 per share and has a dividend yield of 0.7%. HMN Financial pays out 31.0% of its earnings in the form of a dividend. HMN Financial has raised its dividend for 2 consecutive years. HMN Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

HMN Financial beats TC Bancshares on 9 of the 12 factors compared between the two stocks.

About HMN Financial

HMN Financial, Inc. operates as a bank holding company for Home Federal Savings Bank that provides various retail banking products and services. The company offers various deposit accounts, such as savings, interest bearing checking, non-interest-bearing checking, money market, individual retirement, and certificate accounts. It also provides various loan products comprising single family residential loans; commercial real estate and multi-family mortgage loans; construction loans; consumer loans, such as home equity, automobile, recreational vehicle, mobile home, and lot loans, as well as loans secured by deposit accounts, and other loans for household and personal purposes; and commercial business loans. In addition, the company offers financial planning products and services; and invests in mortgage-backed and related securities, the United States government agency obligations, and other permissible investments. It operates community banking and loan production offices in Minnesota, Iowa, and Wisconsin. HMN Financial, Inc. was founded in 1934 and is headquartered in Rochester, Minnesota.

About TC Bancshares

TC Bancshares, Inc. operates as the holding company for TC Federal Bank that provides various banking services for individual and commercial customers in the United States. It accepts various deposit products, including personal checking accounts, business checking accounts, savings accounts, money market accounts, and certificates of deposit. The company also offers lending products comprising single-family residential loans, home equity lines of credit, closed-end home equity loans, consumer loans, commercial and multi-family residential real estate loans, commercial and industrial loans, construction loans, land development loans, and SBA/USDA guaranteed loans. It operates branches in Thomasville, Georgia and Tallahassee, Florida, as well as loan production offices in Savannah, Georgia, and Jacksonville, Florida. The company was founded in 1934 and is based in Thomasville, Georgia.