Head-To-Head Contrast: SR Bancorp (NASDAQ:SRBK) & NB Bancorp (NASDAQ:NBBK)

SR Bancorp (NASDAQ:SRBK) and NB Bancorp (NASDAQ:NBBK) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, institutional ownership, profitability, valuation, analyst recommendations, risk and earnings.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SR Bancorp	$48.54 million	3.22	$5.14 million	$0.42	46.00
NB Bancorp	$351.74 million	2.63	$50.30 million	$1.37	15.12

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.

Institutional and Insider Ownership

24.7% of SR Bancorp shares are owned by institutional investors. 7.8% of SR Bancorp shares are owned by company insiders. Comparatively, 5.1% of NB Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares SR Bancorp and NB Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SR Bancorp	6.39%	1.41%	0.24%
NB Bancorp	13.81%	8.57%	1.09%

Analyst Recommendations

This is a summary of recent recommendations and price targets for SR Bancorp and NB Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SR Bancorp	0	1	1	0	2.50
NB Bancorp	1	2	1	0	2.00

SR Bancorp presently has a consensus price target of $19.00, indicating a potential downside of 1.66%. NB Bancorp has a consensus price target of $24.00, indicating a potential upside of 15.83%. Given NB Bancorp’s higher probable upside, analysts plainly believe NB Bancorp is more favorable than SR Bancorp.

Dividends

SR Bancorp pays an annual dividend of $0.20 per share and has a dividend yield of 1.0%. NB Bancorp pays an annual dividend of $0.28 per share and has a dividend yield of 1.4%. SR Bancorp pays out 47.6% of its earnings in the form of a dividend. NB Bancorp pays out 20.4% 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.

Risk and Volatility

SR Bancorp has a beta of 0.58, indicating that its share price is 42% less volatile than the S&P 500. Comparatively, NB Bancorp has a beta of 0.06, indicating that its share price is 94% less volatile than the S&P 500.

Summary

NB Bancorp beats SR Bancorp on 9 of the 15 factors compared between the two stocks.

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.

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.