Eagle Bancorp Montana (NASDAQ:EBMT) & Magyar Bancorp (NASDAQ:MGYR) Critical Contrast

Eagle Bancorp Montana (NASDAQ:EBMT) and Magyar Bancorp (NASDAQ:MGYR) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, risk, dividends, valuation and profitability.

Institutional and Insider Ownership

35.7% of Eagle Bancorp Montana shares are held by institutional investors. Comparatively, 46.3% of Magyar Bancorp shares are held by institutional investors. 5.8% of Eagle Bancorp Montana shares are held by company insiders. Comparatively, 11.1% of Magyar Bancorp shares are held 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.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eagle Bancorp Montana	$127.08 million	1.34	$14.84 million	$2.04	10.45
Magyar Bancorp	$58.42 million	2.20	$9.76 million	$1.87	10.64

Eagle Bancorp Montana has higher revenue and earnings than Magyar Bancorp. Eagle Bancorp Montana 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

Eagle Bancorp Montana pays an annual dividend of $0.59 per share and has a dividend yield of 2.8%. Magyar Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.0%. Eagle Bancorp Montana pays out 28.9% of its earnings in the form of a dividend. Magyar Bancorp pays out 21.4% 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. Eagle Bancorp Montana has increased its dividend for 14 consecutive years and Magyar Bancorp has increased its dividend for 3 consecutive years. Eagle Bancorp Montana is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of recent ratings and target prices for Eagle Bancorp Montana and Magyar Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eagle Bancorp Montana	0	3	1	0	2.25
Magyar Bancorp	0	1	0	0	2.00

Eagle Bancorp Montana presently has a consensus price target of $23.50, indicating a potential upside of 10.23%. Given Eagle Bancorp Montana’s stronger consensus rating and higher probable upside, analysts clearly believe Eagle Bancorp Montana is more favorable than Magyar Bancorp.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Eagle Bancorp Montana	12.57%	8.36%	0.76%
Magyar Bancorp	18.89%	9.59%	1.13%

Volatility and Risk

Eagle Bancorp Montana has a beta of 0.37, indicating that its stock price is 63% less volatile than the S&P 500. Comparatively, Magyar Bancorp has a beta of 0.29, indicating that its stock price is 71% less volatile than the S&P 500.

Summary

Eagle Bancorp Montana beats Magyar Bancorp on 9 of the 17 factors compared between the two stocks.

About Eagle Bancorp Montana

Eagle Bancorp Montana, Inc. operates as the bank holding company for Opportunity Bank of Montana that provides various retail banking products and services to small businesses and individuals in Montana. It accepts various deposit products, such as checking, savings, money market, and individual retirement accounts, as well as certificates of deposit accounts. The company also provides 1-4 family residential mortgage loans, such as residential mortgages and construction of residential properties; commercial real estate loans, including multi-family dwellings, nonresidential property, commercial construction and development, and farmland loans; and second mortgage/home equity loans. In addition, it offers consumer loans, such as loans secured by collateral other than real estate, such as automobiles, recreational vehicles, and boats; personal loans and lines of credit; commercial business loans consisting of business loans and lines of credit on a secured and unsecured basis; construction loans; agricultural loans; and mortgage loan services. The company operates full-service branches and automated teller machines. Eagle Bancorp Montana, Inc. was founded in 1922 and is headquartered in Helena, Montana.

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.