Head to Head Comparison: Magyar Bancorp (NASDAQ:MGYR) and Jeffersonville Bancorp (OTCMKTS:JFBC)

Magyar Bancorp (NASDAQ:MGYR) and Jeffersonville Bancorp (OTCMKTS:JFBC) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, valuation, dividends, earnings, risk, analyst recommendations and institutional ownership.

Insider and Institutional Ownership

46.3% of Magyar Bancorp shares are owned by institutional investors. 11.1% of Magyar Bancorp shares are owned by insiders. Comparatively, 8.4% of Jeffersonville Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Magyar Bancorp and Jeffersonville Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Magyar Bancorp	$37.77 million	3.01	$9.76 million	$1.78	9.86
Jeffersonville Bancorp	$34.24 million	3.47	$12.55 million	$2.97	9.46

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

Dividends

Magyar Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.3%. Jeffersonville Bancorp pays an annual dividend of $0.60 per share and has a dividend yield of 2.1%. Magyar Bancorp pays out 22.5% of its earnings in the form of a dividend. Jeffersonville Bancorp pays out 20.2% 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. Magyar Bancorp has raised its dividend for 3 consecutive years. Magyar Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Magyar Bancorp has a beta of 0.23, suggesting that its share price is 77% less volatile than the S&P 500. Comparatively, Jeffersonville Bancorp has a beta of 0.15, suggesting that its share price is 85% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Magyar Bancorp and Jeffersonville Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Magyar Bancorp	0	1	0	0	2.00
Jeffersonville Bancorp	0	0	0	0	0.00

Profitability

This table compares Magyar Bancorp and Jeffersonville Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Magyar Bancorp	18.32%	9.38%	1.10%
Jeffersonville Bancorp	36.66%	12.70%	1.88%

Summary

Magyar Bancorp beats Jeffersonville Bancorp on 8 of the 15 factors compared between the two stocks.

About Magyar Bancorp

Magyar Bancorp, Inc. operates as the holding company for Magyar Bank that provides various consumer and commercial banking services to individuals, businesses, and nonprofit organizations in New Jersey, the United States. It accepts various deposit accounts, including demand, savings, NOW, money market, and retirement accounts, as well as certificates of deposit. The company also provides residential mortgage loans, multi-family and commercial real estate mortgage loans, home equity loans and lines of credit, commercial business loans, and construction loans, as well as small business administration loans. In addition, it offers non-deposit investment products and financial planning services, including insurance products, fixed and variable annuities, and retirement planning for individual and commercial customers; and buys, sells, and holds investment securities. The company has branch offices located in New Brunswick, North Brunswick, South Brunswick, Branchburg, Bridgewater, and Edison, New Jersey. Magyar Bancorp, Inc. was founded in 1922 and is headquartered in New Brunswick, New Jersey.

About Jeffersonville Bancorp

Jeffersonville Bancorp operates as the bank holding company for Jeff Bank that provides community banking services to individuals, small businesses, and local municipal governments primarily in Sullivan County, New York. The company offers various deposit products, such as checking, money market, savings, and NOW, as well as demand and time deposits. It also offers commercial mortgage, farmland, construction, real estate, agricultural, residential mortgage, home equity, consumer, installment, and other consumer loans. The company was founded in 1913 and is based in Jeffersonville, New York.