Contrasting Northeast Community Bancorp (NASDAQ:NECB) and M&T Bank (NYSE:MTB)

M&T Bank (NYSE:MTB) and Northeast Community Bancorp (NASDAQ:NECB) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, dividends and valuation.

Profitability

This table compares M&T Bank and Northeast Community Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
M&T Bank	22.63%	11.86%	1.40%
Northeast Community Bancorp	27.21%	11.44%	1.96%

Earnings & Valuation

This table compares M&T Bank and Northeast Community Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
M&T Bank	$13.23 billion	2.38	$2.85 billion	$19.16	11.45
Northeast Community Bancorp	$102.59 million	3.93	$44.41 million	$3.04	9.62

M&T Bank has higher revenue and earnings than Northeast Community Bancorp. Northeast Community Bancorp is trading at a lower price-to-earnings ratio than M&T Bank, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

M&T Bank has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500. Comparatively, Northeast Community Bancorp has a beta of 0.37, suggesting that its share price is 63% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for M&T Bank and Northeast Community Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
M&T Bank	2	13	8	0	2.26
Northeast Community Bancorp	0	1	2	2	3.20

M&T Bank presently has a consensus price target of $244.89, suggesting a potential upside of 11.62%. Northeast Community Bancorp has a consensus price target of $30.25, suggesting a potential upside of 3.38%. Given M&T Bank’s higher possible upside, equities research analysts clearly believe M&T Bank is more favorable than Northeast Community Bancorp.

Dividends

M&T Bank pays an annual dividend of $6.00 per share and has a dividend yield of 2.7%. Northeast Community Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 3.4%. M&T Bank pays out 31.3% of its earnings in the form of a dividend. Northeast Community Bancorp pays out 32.9% 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. Northeast Community Bancorp has increased its dividend for 2 consecutive years. Northeast Community Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

84.7% of M&T Bank shares are held by institutional investors. Comparatively, 53.2% of Northeast Community Bancorp shares are held by institutional investors. 0.4% of M&T Bank shares are held by insiders. Comparatively, 7.1% of Northeast Community Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

M&T Bank beats Northeast Community Bancorp on 10 of the 18 factors compared between the two stocks.

About M&T Bank

M&T Bank Corporation is a regional financial holding company headquartered in Buffalo, New York. Founded in 1856 as Manufacturers and Traders Bank, the company operates primarily through M&T Bank and its wealth-management subsidiary, Wilmington Trust. M&T provides retail and commercial banking services, including checking and savings accounts, loans, mortgages, credit cards, and cash-management services. Through Wilmington Trust and other businesses, it also offers wealth management, trust, investment, and related financial services.

About Northeast Community Bancorp

Northeast Community Bancorp, Inc. is the holding company for NorthEast Community Bank, a community bank headquartered in White Plains, New York. The bank traces its roots to 1934 and serves individuals and businesses in the New York metropolitan area, including communities in New York, New Jersey and Massachusetts. The bank offers deposit accounts and other traditional banking services, along with lending for multifamily and commercial real estate, construction, commercial businesses and residential properties.