Waterstone Financial (NASDAQ:WSBF) and SB Financial Group (NASDAQ:SBFG) Critical Survey

SB Financial Group (NASDAQ:SBFG) and Waterstone Financial (NASDAQ:WSBF) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, earnings, valuation, profitability, dividends, risk and analyst recommendations.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for SB Financial Group and Waterstone Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SB Financial Group	0	2	0	1	2.67
Waterstone Financial	0	0	1	0	3.00

SB Financial Group presently has a consensus price target of $32.00, indicating a potential upside of 10.21%. Given SB Financial Group’s higher possible upside, analysts clearly believe SB Financial Group is more favorable than Waterstone Financial.

Insider & Institutional Ownership

66.7% of SB Financial Group shares are held by institutional investors. Comparatively, 62.7% of Waterstone Financial shares are held by institutional investors. 6.0% of SB Financial Group shares are held by insiders. Comparatively, 6.0% of Waterstone Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares SB Financial Group and Waterstone Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SB Financial Group	$91.03 million	1.99	$13.97 million	$2.67	10.87
Waterstone Financial	$201.29 million	1.79	$26.40 million	$1.72	11.68

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

Volatility & Risk

SB Financial Group has a beta of 0.18, suggesting that its share price is 82% less volatile than the S&P 500. Comparatively, Waterstone Financial has a beta of 0.76, suggesting that its share price is 24% less volatile than the S&P 500.

Dividends

SB Financial Group pays an annual dividend of $0.64 per share and has a dividend yield of 2.2%. Waterstone Financial pays an annual dividend of $0.68 per share and has a dividend yield of 3.4%. SB Financial Group pays out 24.0% of its earnings in the form of a dividend. Waterstone Financial pays out 39.5% 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. SB Financial Group has increased its dividend for 12 consecutive years.

Profitability

This table compares SB Financial Group and Waterstone Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SB Financial Group	17.17%	11.46%	1.03%
Waterstone Financial	14.57%	8.64%	1.33%

About SB Financial Group

SB Financial Group, Inc. is a financial holding company headquartered in Defiance, Ohio. Through its principal subsidiary, The State Bank and Trust Company, the company provides community banking services to individuals, families, businesses and organizations. The State Bank and Trust Company offers deposit accounts, commercial and consumer lending, residential and commercial real estate financing, treasury management and other traditional banking products. The company also provides trust, investment management and wealth management services, along with mortgage banking and related financial services.

About Waterstone Financial

Waterstone Financial, Inc. is a savings and loan holding company headquartered in Wisconsin. Its principal subsidiary, WaterStone Bank, is a community bank that provides banking and lending services to individuals, families, businesses and real estate investors. WaterStone Bank offers deposit products such as checking, savings, money market and certificate accounts, along with residential mortgage loans, home equity financing, commercial real estate loans, business loans and consumer lending. The bank also provides digital banking and other standard financial services through its branch network and electronic channels.