Financial Review: Stock Yards Bancorp (NASDAQ:SYBT) vs. OceanFirst Financial (NASDAQ:OCFC)

Stock Yards Bancorp (NASDAQ:SYBT) and OceanFirst Financial (NASDAQ:OCFC) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, valuation, analyst recommendations, institutional ownership, earnings, profitability and dividends.

Valuation & Earnings

This table compares Stock Yards Bancorp and OceanFirst Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stock Yards Bancorp	$415.10 million	5.74	$140.15 million	$5.02	15.27
OceanFirst Financial	$437.72 million	3.55	$70.98 million	$0.85	18.94

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

Analyst Ratings

This is a summary of recent recommendations for Stock Yards Bancorp and OceanFirst Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stock Yards Bancorp	0	6	1	0	2.14
OceanFirst Financial	0	5	0	0	2.00

Stock Yards Bancorp presently has a consensus price target of $88.00, indicating a potential upside of 14.79%. OceanFirst Financial has a consensus price target of $20.33, indicating a potential upside of 26.29%. Given OceanFirst Financial’s higher probable upside, analysts clearly believe OceanFirst Financial is more favorable than Stock Yards Bancorp.

Profitability

This table compares Stock Yards Bancorp and OceanFirst Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stock Yards Bancorp	25.41%	13.39%	1.55%
OceanFirst Financial	6.38%	5.34%	0.59%

Dividends

Stock Yards Bancorp pays an annual dividend of $1.32 per share and has a dividend yield of 1.7%. OceanFirst Financial pays an annual dividend of $0.80 per share and has a dividend yield of 5.0%. Stock Yards Bancorp pays out 26.3% of its earnings in the form of a dividend. OceanFirst Financial pays out 94.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Stock Yards Bancorp has increased its dividend for 15 consecutive years.

Risk and Volatility

Stock Yards Bancorp has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500. Comparatively, OceanFirst Financial has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500.

Institutional and Insider Ownership

56.5% of Stock Yards Bancorp shares are owned by institutional investors. Comparatively, 71.0% of OceanFirst Financial shares are owned by institutional investors. 2.9% of Stock Yards Bancorp shares are owned by insiders. Comparatively, 5.4% of OceanFirst Financial shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Stock Yards Bancorp beats OceanFirst Financial on 10 of the 17 factors compared between the two stocks.

About Stock Yards Bancorp

Stock Yards Bancorp, Inc. operates as a holding company for Stock Yards Bank & Trust Company that provides various financial services for individuals, corporations, and others in the United States. It operates in two segments, Commercial Banking, and WM&T. The Commercial Banking segment offers a range of loan and deposit products to individual consumers and businesses in all its markets through retail lending, mortgage banking, deposit services, online banking, mobile banking, private banking, commercial lending, commercial real estate lending, leasing, treasury management services, merchant services, international banking, correspondent banking, and other banking services. This segment also provides securities brokerage services through an arrangement with a third party broker-dealer. The WM&T segment provides investment management, financial and retirement planning, and trust and estate services, as well as retirement plan management for businesses and corporations. It provides services in Louisville, central, eastern, and northern Kentucky, as well as Indianapolis, Indiana and Cincinnati, Ohio metropolitan markets. The company was founded in 1904 and is headquartered in Louisville, Kentucky.

About OceanFirst Financial

OceanFirst Financial Corp. operates as the bank holding company for OceanFirst Bank N.A. that provides community banking services to retail and commercial customers. It accepts money market accounts, savings accounts, interest-bearing checking accounts, non-interest-bearing accounts, and time deposits, that includes brokered deposits to retail, government, and business customers. The company also offers commercial real estate, multi-family, land loans, construction, and commercial and industrial loans; fixed-rate and adjustable-rate mortgage loans that are secured by one-to-four family residences; and consumer loans, such as home equity loans and lines of credit, student loans, overdraft line of credit, loans on savings accounts, and other consumer loans. In addition, it invests in mortgage-backed securities, securities issued by the U.S. Government and agencies, corporate securities, and other investments. Further, the company offers bankcard, trust and asset management services; and bank owned life insurance products. The company was founded in 1902 and is based in Red Bank, New Jersey.