Comparing Broadway Financial (NASDAQ:BYFC) and West Bancorporation (NASDAQ:WTBA)

Broadway Financial (NASDAQ:BYFC) and West Bancorporation (NASDAQ:WTBA) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, analyst recommendations, valuation and profitability.

Earnings & Valuation

This table compares Broadway Financial and West Bancorporation”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Broadway Financial	$63.03 million	1.41	-$24.80 million	($2.75)	-3.49
West Bancorporation	$202.45 million	2.27	$32.56 million	$2.06	13.09

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

Profitability

This table compares Broadway Financial and West Bancorporation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Broadway Financial	-31.80%	3.01%	0.27%
West Bancorporation	17.30%	14.88%	0.95%

Risk & Volatility

Broadway Financial has a beta of 0.81, indicating that its stock price is 19% less volatile than the S&P 500. Comparatively, West Bancorporation has a beta of 0.72, indicating that its stock price is 28% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for Broadway Financial and West Bancorporation, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Broadway Financial	1	0	0	0	1.00
West Bancorporation	0	3	1	0	2.25

West Bancorporation has a consensus price target of $26.25, indicating a potential downside of 2.65%. Given West Bancorporation’s stronger consensus rating and higher probable upside, analysts plainly believe West Bancorporation is more favorable than Broadway Financial.

Insider and Institutional Ownership

12.1% of Broadway Financial shares are held by institutional investors. Comparatively, 44.3% of West Bancorporation shares are held by institutional investors. 3.0% of Broadway Financial shares are held by company insiders. Comparatively, 4.6% of West Bancorporation shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

West Bancorporation beats Broadway Financial on 13 of the 14 factors compared between the two stocks.

About Broadway Financial

Broadway Financial Corporation operates as the holding company for City First Bank, National Association that provides various banking products and services in the United States. It accepts various deposit accounts, including savings accounts, checking accounts, interest checking accounts, money market accounts, and fixed-term certificates of deposit. The company also offers mortgage loans, which are secured by multi-family residential properties; single family residential properties; and commercial real estate, including charter schools, community facilities, and churches, as well as commercial business, construction, and consumer loans. In addition, it invests in securities issued by federal government agencies, residential mortgage-backed securities, and other investments. The company was founded in 1946 and is headquartered in Los Angeles, California.

About West Bancorporation

West Bancorporation, Inc. operates as the financial holding company provides community banking and trust services to individuals and small- to medium-sized businesses in the United States. It offers deposit services, including checking, savings, and money market accounts, as well as time certificates of deposit. The company also provides loan products comprising commercial real estate loans, construction and land development loans, commercial lines of credit, and commercial term loans; consumer loans, including loans extended to individuals for household, family, and other personal expenditures not secured by real estate; and 1-4 family residential mortgages and home equity loans. In addition, it offers online and mobile banking, treasury management services including cash management, client-generated automated clearing house transactions, remote deposit, and fraud protection services; merchant credit card processing and corporate credit cards; and administration of estates, conservatorships, personal trusts, and agency accounts. The company was founded in 1893 and is headquartered in West Des Moines, Iowa.