Head to Head Review: Kearny Financial (NASDAQ:KRNY) and Ottawa Bancorp (OTCMKTS:OTTW)

Kearny Financial (NASDAQ:KRNY) and Ottawa Bancorp (OTCMKTS:OTTW) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, analyst recommendations, earnings, dividends and profitability.

Institutional & Insider Ownership

71.0% of Kearny Financial shares are owned by institutional investors. 8.2% of Kearny Financial shares are owned by insiders. Comparatively, 7.8% of Ottawa Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Kearny Financial and Ottawa Bancorp’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kearny Financial	$296.48 million	1.20	$40.81 million	$0.25	22.04
Ottawa Bancorp	$16.45 million	1.72	$1.67 million	$0.67	16.58

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

Dividends

Kearny Financial pays an annual dividend of $0.44 per share and has a dividend yield of 8.0%. Ottawa Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 4.0%. Kearny Financial pays out 176.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ottawa Bancorp pays out 65.7% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of current recommendations and price targets for Kearny Financial and Ottawa Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kearny Financial	0	0	0	0	N/A
Ottawa Bancorp	0	0	0	0	N/A

Profitability

This table compares Kearny Financial and Ottawa Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kearny Financial	4.80%	4.04%	0.43%
Ottawa Bancorp	10.15%	4.04%	0.46%

Risk & Volatility

Kearny Financial has a beta of 0.73, indicating that its stock price is 27% less volatile than the S&P 500. Comparatively, Ottawa Bancorp has a beta of 0.35, indicating that its stock price is 65% less volatile than the S&P 500.

Summary

Kearny Financial beats Ottawa Bancorp on 7 of the 12 factors compared between the two stocks.

About Kearny Financial

Kearny Financial Corp. operates as the holding company for Kearny Bank that provides various banking products and services in the United States. The company offers various deposit products, including interest-bearing and non-interest-bearing checking accounts, money market deposit accounts, savings accounts, and certificates of deposit accounts. It also provides various loans, such as multi-family and nonresidential real estate mortgage loans, commercial term loans and lines of credit, one- to four-family residential mortgage loans, and home equity loans and lines of credit; loans to individuals, builders, or developers for the construction of multi-family residential buildings or commercial real estate, or for the construction or renovation of one- to four-family residences; overdraft lines of credit; and personal loans. In addition, the company engages in investment activities. Kearny Financial Corp. was founded in 1884 and is headquartered in Fairfield, New Jersey.

About Ottawa Bancorp

Ottawa Bancorp, Inc. operates as the bank holding company for OSB Community Bank, a savings bank that provides various financial services to individual and corporate customers in Illinois. The company's deposit products include saving, checking, money market, and interest-bearing accounts, as well as certificate of deposit. Its loan portfolio comprises commercial, non-residential real estate, one-to-four family residential, multi-family residential, consumer direct, and purchased auto loans; business and construction loans; motor vehicle, home improvement, share, and personal unsecured loans, as well as home equity and small personal credit lines; mortgage loans; and student loans. The company also provides cash management solutions, such as remote deposit capture, automated clearing house/payroll direct deposit, and merchant services, as well as commercial leasing services. In addition, it offers notary, lamination, night depository, document faxing, money gift envelopes, safe deposit boxes, and coin counting, as well as debit and credit cards, and digital banking services. The company was formerly known as Ottawa Savings Bancorp, Inc. and changed its name to Ottawa Bancorp, Inc. in October 2016. Ottawa Bancorp, Inc. was founded in 1871 and is based in Ottawa, Illinois.