Critical Comparison: Eagle Bancorp (NASDAQ:EGBN) & Ottawa Bancorp (OTCMKTS:OTTW)

Ottawa Bancorp (OTCMKTS:OTTW) and Eagle Bancorp (NASDAQ:EGBN) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, profitability, valuation, dividends and risk.

Profitability

This table compares Ottawa Bancorp and Eagle Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ottawa Bancorp	10.21%	4.70%	0.53%
Eagle Bancorp	-18.65%	-10.07%	-1.10%

Insider & Institutional Ownership

78.0% of Eagle Bancorp shares are owned by institutional investors. 7.8% of Ottawa Bancorp shares are owned by insiders. Comparatively, 3.1% of Eagle Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Ottawa Bancorp and Eagle Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ottawa Bancorp	$17.43 million	1.92	$780,000.00	$0.79	18.48
Eagle Bancorp	$707.50 million	0.93	-$47.03 million	($3.96)	-5.45

Ottawa Bancorp has higher earnings, but lower revenue than Eagle Bancorp. Eagle Bancorp is trading at a lower price-to-earnings ratio than Ottawa Bancorp, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Ottawa Bancorp has a beta of 0.05, meaning that its stock price is 95% less volatile than the S&P 500. Comparatively, Eagle Bancorp has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Ottawa Bancorp and Eagle Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ottawa Bancorp	0	0	0	0	0.00
Eagle Bancorp	1	4	1	0	2.00

Eagle Bancorp has a consensus target price of $21.25, indicating a potential downside of 1.48%. Given Eagle Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe Eagle Bancorp is more favorable than Ottawa Bancorp.

Dividends

Ottawa Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 3.0%. Eagle Bancorp pays an annual dividend of $0.04 per share and has a dividend yield of 0.2%. Ottawa Bancorp pays out 55.7% of its earnings in the form of a dividend. Eagle Bancorp pays out -1.0% 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.

Summary

Ottawa Bancorp beats Eagle Bancorp on 9 of the 16 factors compared between the two stocks.

About Ottawa Bancorp

Ottawa Bancorp, Inc. operates as the bank holding company for OSB Community Bank, a savings bank that provides various financial services to individual and corporate customers in Illinois. The company's deposit products include saving, checking, money market, and interest-bearing accounts, as well as certificate of deposit. Its loan portfolio comprises commercial, non-residential real estate, one-to-four family residential, multi-family residential, consumer direct, and purchased auto loans; business and construction loans; motor vehicle, home improvement, share, and personal unsecured loans, as well as home equity and small personal credit lines; mortgage loans; and student loans. The company also provides cash management solutions, such as remote deposit capture, automated clearing house/payroll direct deposit, and merchant services, as well as commercial leasing services. In addition, it offers notary, lamination, night depository, document faxing, money gift envelopes, safe deposit boxes, and coin counting, as well as debit and credit cards, and digital banking services. The company was formerly known as Ottawa Savings Bancorp, Inc. and changed its name to Ottawa Bancorp, Inc. in October 2016. Ottawa Bancorp, Inc. was founded in 1871 and is based in Ottawa, Illinois.

About Eagle Bancorp

Eagle Bancorp, Inc. operates as the bank holding company for EagleBank that provides commercial and consumer banking services primarily in the United States. The company also offers various commercial and consumer lending products comprising commercial loans for working capital, equipment purchases, real estate lines of credit, and government contract financing; asset based lending and accounts receivable financing; construction and commercial real estate loans; business equipment financing; consumer home equity lines of credit, personal lines of credit, and term loans; consumer installment loans, such as auto and personal loans; personal credit cards; and residential mortgage loans. In addition, it provides online and mobile banking services; checking and saving accounts; and other deposit services, including cash management services, business sweep accounts, lock boxes, remote deposit captures, account reconciliation services, merchant card services, safety deposit boxes, and automated clearing house origination, as well as after-hours depositories and ATM services. Further, the company offers insurance products and services through a referral program; and treasury management services. The company serves sole proprietors, small and medium-sized businesses, partnerships, corporations, and non-profit organizations and associations, as well as investors. Eagle Bancorp, Inc. was incorporated in 1997 and is headquartered in Bethesda, Maryland.