Head-To-Head Analysis: Catalyst Bancorp (NASDAQ:CLST) versus Webster Financial (NYSE:WBS)

Webster Financial (NYSE:WBS) and Catalyst Bancorp (NASDAQ:CLST) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, dividends, risk and institutional ownership.

Insider and Institutional Ownership

85.6% of Webster Financial shares are held by institutional investors. Comparatively, 33.1% of Catalyst Bancorp shares are held by institutional investors. 0.5% of Webster Financial shares are held by company insiders. Comparatively, 10.1% of Catalyst Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk and Volatility

Webster Financial has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500. Comparatively, Catalyst Bancorp has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500.

Profitability

This table compares Webster Financial and Catalyst Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Webster Financial	22.78%	11.23%	1.23%
Catalyst Bancorp	12.99%	2.47%	0.71%

Earnings and Valuation

This table compares Webster Financial and Catalyst Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Webster Financial	$2.94 billion	4.27	$1.00 billion	$6.15	12.61
Catalyst Bancorp	$11.38 million	6.31	$2.05 million	$0.55	32.38

Webster Financial has higher revenue and earnings than Catalyst Bancorp. Webster Financial is trading at a lower price-to-earnings ratio than Catalyst Bancorp, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings for Webster Financial and Catalyst Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Webster Financial	1	11	4	0	2.19
Catalyst Bancorp	0	1	0	0	2.00

Webster Financial presently has a consensus target price of $74.25, suggesting a potential downside of 4.28%. Given Webster Financial’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Webster Financial is more favorable than Catalyst Bancorp.

Summary

Webster Financial beats Catalyst Bancorp on 11 of the 14 factors compared between the two stocks.

About Webster Financial

Webster Financial Corporation operates as the bank holding company for Webster Bank, National Association that provides a range of financial products and services to individuals, families, and businesses in the United States. It operates through three segments: Commercial Banking, HSA Bank, and Consumer Banking. The Commercial Banking segment offers commercial real estate and equipment financing, business banking, asset-based lending, and commercial services; public sector finance; mortgage warehouse financing; sponsor and specialty financing services; credit, deposit, and cash flow management services; and wealth management solutions to business owners and operators, including trust, asset management, financial planning, insurance, retirement, and investment products, as well as treasury management services comprising derivative, treasury, accounts payable, accounts receivable, and trade products and services. This segment also provides commercial services, such as accounts receivable factoring and trade financing, payroll funding, and business process outsourcing. The HSA Bank segment offers health savings accounts, health reimbursement arrangements, flexible spending accounts, and commuter benefit services that are distributed directly to employers and individual consumers, as well as through national and regional insurance carriers, benefit consultants, and financial advisors. The Consumer Banking segment provides consumer deposit and fee-based services, residential mortgages, home equity lines, secured and unsecured loans, and credit cards to consumers; and small business banking products, such as credit, deposit, and cash flow management products to businesses and professional service firms. The company offers online and mobile banking services. Webster Financial Corporation was founded in 1935 and is headquartered in Stamford, Connecticut.

About Catalyst Bancorp

Catalyst Bancorp, Inc. operates as a holding company for Catalyst Bank that provides various banking services to individuals and businesses in Louisiana. The company accepts various deposit products, including savings accounts, demand and NOW accounts, money market accounts, and certificates of deposit. It also offers single family residential first mortgage loans, commercial real estate mortgage loans, multi-family residential mortgage loans, commercial and industrial loans, construction and land loans, consumer loans, and other loans. In addition, the company invests in various types of securities comprising mortgage-backed securities, the U.S. treasury obligations, securities of various federal agencies and of state and municipal governments, certificates of deposit at federally insured banks and savings institutions, and federal funds. Catalyst Bancorp, Inc. was founded in 1922 and is headquartered in Opelousas, Louisiana.