OceanFirst Financial (NASDAQ:OCFC) and BankFinancial (NASDAQ:BFIN) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, risk, profitability, institutional ownership, earnings and dividends.
Institutional & Insider Ownership
70.5% of OceanFirst Financial shares are held by institutional investors. Comparatively, 66.5% of BankFinancial shares are held by institutional investors. 3.8% of OceanFirst Financial shares are held by company insiders. Comparatively, 15.2% of BankFinancial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
OceanFirst Financial pays an annual dividend of $0.68 per share and has a dividend yield of 2.8%. BankFinancial pays an annual dividend of $0.40 per share and has a dividend yield of 2.7%. OceanFirst Financial pays out 34.3% of its earnings in the form of a dividend. BankFinancial pays out 46.5% 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. OceanFirst Financial has raised its dividend for 5 consecutive years and BankFinancial has raised its dividend for 5 consecutive years. OceanFirst Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.
Risk and Volatility
OceanFirst Financial has a beta of 0.75, meaning that its stock price is 25% less volatile than the S&P 500. Comparatively, BankFinancial has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500.
This table compares OceanFirst Financial and BankFinancial’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent recommendations for OceanFirst Financial and BankFinancial, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
OceanFirst Financial currently has a consensus price target of $32.25, indicating a potential upside of 30.78%. Given OceanFirst Financial’s stronger consensus rating and higher probable upside, equities analysts clearly believe OceanFirst Financial is more favorable than BankFinancial.
Valuation and Earnings
This table compares OceanFirst Financial and BankFinancial’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|OceanFirst Financial||$311.48 million||4.07||$71.93 million||$1.98||12.45|
|BankFinancial||$76.16 million||3.26||$19.34 million||$0.86||17.52|
OceanFirst Financial has higher revenue and earnings than BankFinancial. OceanFirst Financial is trading at a lower price-to-earnings ratio than BankFinancial, indicating that it is currently the more affordable of the two stocks.
OceanFirst Financial beats BankFinancial on 13 of the 16 factors compared between the two stocks.
About OceanFirst Financial
OceanFirst Financial Corp. operates as the holding company for OceanFirst Bank N.A. that provides a range of community banking services. The company offers various deposit products to retail, government, and business customers, including money market accounts, savings accounts, interest-bearing checking accounts, non-interest-bearing accounts, and time deposits. It also provides commercial real estate, multi-family mortgage, and land loans; fixed-rate and adjustable-rate mortgage loans that are secured by one-to-four family residences; consumer loans, such as home equity loans and lines of credit, student loans, overdraft line of credit, loans on savings accounts, and other consumer loans; and commercial and industrial loans, and lines of credit. In addition, the company invests in mortgage-backed securities, securities issued by the U.S. Government and agencies, corporate securities, and other investments. Further, it offers bankcard and wealth management services; and sells alternative investment products and life insurance products. The company operates through its branch office in Toms River; administrative office located in Red Bank; and 58 additional branch offices and 3 deposit production facilities located throughout central and southern New Jersey, as well as commercial loan production offices in New York City, the Philadelphia area and Atlantic, Cape May, and Mercer Counties in New Jersey. OceanFirst Financial Corp. was founded in 1902 and is based in Red Bank, New Jersey.
BankFinancial Corporation operates as the bank holding company for BankFinancial, National Association that provides commercial, family, and personal banking products and services in Illinois. The company accepts various deposit products, including savings, NOW, checking, money market, IRA, and other retirement accounts, as well as certificates of deposit. Its loan products include multi-family and nonresidential real estate, construction and land, and commercial loans, as well as commercial leases; consumer loans; and one-to-four family residential mortgage loans, including home equity loans and lines of credit. The company also provides various financial products and services, such as cash management, fund transfer, bill payment and other online and mobile banking transactions, automated teller machines, safe deposit boxes, trust, wealth management, and general insurance agency. In addition, it offers financial planning services; and sells property and casualty, and other insurance products on an agency basis. As of February 1, 2019, the company operated 19 full-service banking offices located in Cook, DuPage, Lake, and Will Counties, Illinois. BankFinancial Corporation was founded in 1924 and is headquartered in Burr Ridge, Illinois.
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