Financial Review: Broadway Financial (NASDAQ:BYFC) vs. Eagle Financial Services (NASDAQ:EFSI)

Eagle Financial Services (NASDAQ:EFSI) and Broadway Financial (NASDAQ:BYFC) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, risk, analyst recommendations, profitability, valuation and earnings.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Eagle Financial Services and Broadway Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eagle Financial Services	0	3	2	1	2.67
Broadway Financial	1	0	0	0	1.00

Eagle Financial Services presently has a consensus target price of $43.75, indicating a potential downside of 3.95%. Given Eagle Financial Services’ stronger consensus rating and higher possible upside, analysts plainly believe Eagle Financial Services is more favorable than Broadway Financial.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Eagle Financial Services	15.16%	8.38%	0.85%
Broadway Financial	-29.36%	3.49%	0.28%

Institutional & Insider Ownership

0.3% of Eagle Financial Services shares are owned by institutional investors. Comparatively, 12.1% of Broadway Financial shares are owned by institutional investors. 7.1% of Eagle Financial Services shares are owned by insiders. Comparatively, 3.0% of Broadway Financial shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk and Volatility

Eagle Financial Services has a beta of 0.21, suggesting that its share price is 79% less volatile than the S&P 500. Comparatively, Broadway Financial has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500.

Earnings & Valuation

This table compares Eagle Financial Services and Broadway Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eagle Financial Services	$87.31 million	2.82	$8.21 million	$3.46	13.16
Broadway Financial	$63.03 million	1.71	-$24.80 million	($2.71)	-4.28

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

Summary

Eagle Financial Services beats Broadway Financial on 13 of the 15 factors compared between the two stocks.

About Eagle Financial Services

Eagle Financial Services, Inc. operates as the bank holding company for Bank of Clarke County that provides various retail and commercial banking products and services in the Shenandoah Valley and Northern Virginia. The company’s deposit products include checking, NOW, money market, and regular savings accounts; and demand and time deposits. Its loan portfolio comprises one-to-four-family residential real estate, commercial real estate, construction and land development, and commercial and industrial loans, as well as secured and unsecured consumer loans, which include personal installment loans, personal lines of credit, automobile loans, and credit card loans. The company also offers personal and retirement plan services; investment services comprising tax-deferred annuities, IRAs and rollovers, mutual funds, retirement plans, college savings plans, life insurance, long term care insurance, fixed income investing, brokerage CDs, and full service or discount brokerage services; non-deposit investment products; and title insurance products. In addition, it provides ATM and debit cards; and telephone, internet, and mobile banking services, as well as other commercial deposit account services, such as ACH origination and remote deposit capture services. The company operates through twelve full-service branches, two loan production offices, one wealth management office, and one drive-through only facility, as well as 13 ATM locations in the Virginia communities of Berryville, Winchester, Boyce, Stephens City, Purcellville, Warrenton, Leesburg, Ashburn, and Fairfax. Eagle Financial Services, Inc. was founded in 1881 and is headquartered in Berryville, Virginia.

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.