NB Bancorp (NASDAQ:NBBK – Get Free Report) and SR Bancorp (NASDAQ:SRBK – Get Free Report) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, analyst recommendations, risk, institutional ownership, valuation, dividends and profitability.
Institutional & Insider Ownership
24.7% of SR Bancorp shares are owned by institutional investors. 5.1% of NB Bancorp shares are owned by company insiders. Comparatively, 7.8% of SR Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Risk & Volatility
NB Bancorp has a beta of 0.06, suggesting that its stock price is 94% less volatile than the S&P 500. Comparatively, SR Bancorp has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| NB Bancorp | 13.81% | 8.57% | 1.09% |
| SR Bancorp | 6.39% | 1.41% | 0.24% |
Dividends
NB Bancorp pays an annual dividend of $0.28 per share and has a dividend yield of 1.3%. SR Bancorp pays an annual dividend of $0.24 per share and has a dividend yield of 1.2%. NB Bancorp pays out 20.4% of its earnings in the form of a dividend. SR Bancorp pays out 57.1% 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. NB Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.
Analyst Ratings
This is a breakdown of recent recommendations for NB Bancorp and SR Bancorp, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| NB Bancorp | 0 | 3 | 1 | 0 | 2.25 |
| SR Bancorp | 0 | 1 | 1 | 0 | 2.50 |
NB Bancorp currently has a consensus target price of $24.00, indicating a potential upside of 13.26%. SR Bancorp has a consensus target price of $19.00, indicating a potential downside of 2.16%. Given NB Bancorp’s higher probable upside, equities analysts clearly believe NB Bancorp is more favorable than SR Bancorp.
Earnings and Valuation
This table compares NB Bancorp and SR Bancorp”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| NB Bancorp | $351.74 million | 2.69 | $50.30 million | $1.37 | 15.47 |
| SR Bancorp | $34.23 million | 4.60 | $5.14 million | $0.42 | 46.24 |
NB Bancorp has higher revenue and earnings than SR Bancorp. NB Bancorp is trading at a lower price-to-earnings ratio than SR Bancorp, indicating that it is currently the more affordable of the two stocks.
Summary
NB Bancorp beats SR Bancorp on 9 of the 15 factors compared between the two stocks.
About NB Bancorp
NB Bancorp, Inc. focuses on operating as a bank holding company for Needham Bank that provides various banking products and services in Greater Boston metropolitan area and surrounding communities in Massachusetts, eastern Connecticut, southern New Hampshire, and Rhode Island. The company offers various deposits, including certificate of deposit, individual retirement, money market, savings, NOW, demand deposit, and interest-bearing and noninterest-bearing checking accounts; and commercial real estate and multifamily, one- to four-family residential real estate, construction and land development, commercial and industrial, and consumer loans, as well as home equity loans and lines of credit. It also invests in securities consisting of U.S. treasury and federal agency securities, government-sponsored residential mortgage-backed securities, municipal bonds, and corporate bonds. The company was founded in 1892 and is based in Needham, Massachusetts.
About SR Bancorp
SR Bancorp, Inc. operates as the holding company for Somerset Regal Bank that provides customary retail and commercial banking services to individuals, businesses, and local municipalities in the communities of Somerset, Middlesex, Hunterdon, and Essex counties in New Jersey. It offers deposit instruments, including noninterest-bearing demand deposits, interest-bearing demand accounts, savings accounts, money market accounts, and certificates of deposit. The company also provides loans comprising one- to four family-residential mortgage loans, home equity loans and lines of credit, unsecured personal loans, and rehabilitation loans; and bill payment services. In addition, it is involved in the investment activities. The company was founded in 1887 and is headquartered in Bound Brook, New Jersey.
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