Blue Hills Bancorp (NASDAQ: BHBK) and Astoria Financial (NYSE:AF) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, risk, earnings, analyst recommendations and valuation.

Valuation & Earnings

This table compares Blue Hills Bancorp and Astoria Financial’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Blue Hills Bancorp $81.67 million 6.54 $8.65 million $0.80 24.88
Astoria Financial N/A N/A N/A $0.57 37.72

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

Dividends

Blue Hills Bancorp pays an annual dividend of $0.60 per share and has a dividend yield of 3.0%. Astoria Financial pays an annual dividend of $0.16 per share and has a dividend yield of 0.7%. Blue Hills Bancorp pays out 75.0% of its earnings in the form of a dividend. Astoria Financial pays out 28.1% 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.

Analyst Ratings

This is a breakdown of current ratings for Blue Hills Bancorp and Astoria Financial, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Blue Hills Bancorp 0 2 0 0 2.00
Astoria Financial 0 2 1 0 2.33

Blue Hills Bancorp currently has a consensus price target of $22.50, indicating a potential upside of 13.07%. Astoria Financial has a consensus price target of $22.00, indicating a potential upside of 2.33%. Given Blue Hills Bancorp’s higher probable upside, analysts clearly believe Blue Hills Bancorp is more favorable than Astoria Financial.

Institutional and Insider Ownership

52.0% of Blue Hills Bancorp shares are owned by institutional investors. Comparatively, 83.6% of Astoria Financial shares are owned by institutional investors. 3.7% of Blue Hills Bancorp shares are owned by company insiders. Comparatively, 9.8% of Astoria Financial shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility and Risk

Blue Hills Bancorp has a beta of 0.27, suggesting that its share price is 73% less volatile than the S&P 500. Comparatively, Astoria Financial has a beta of 0.55, suggesting that its share price is 45% less volatile than the S&P 500.

Profitability

This table compares Blue Hills Bancorp and Astoria Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Blue Hills Bancorp 19.33% 3.50% 0.55%
Astoria Financial 19.90% 3.91% 0.51%

Summary

Astoria Financial beats Blue Hills Bancorp on 9 of the 14 factors compared between the two stocks.

Blue Hills Bancorp Company Profile

Blue Hills Bancorp, Inc. is a bank holding company for the Blue Hills Bank (the Bank). Blue Hills Bank is a Massachusetts-chartered savings bank. As of December 31, 2016, the Bank provided financial services to individuals, families, small to mid-size businesses and government and non-profit organizations online and through its 11 full-service branch offices located in Brookline, Dedham, Hyde Park, Milton, Nantucket, Norwood, West Roxbury, and Westwood, Massachusetts. Its primary deposit-taking market includes Norfolk, Suffolk and Nantucket Counties in Massachusetts, and its lending market is primarily based in eastern Massachusetts. Its business consists primarily of accepting deposits from the general public, commercial businesses and government and non-profit organizations, and investing those deposits, together with funds generated from operations and borrowings in one- to four-family residential mortgage loans, commercial business loans and investment securities, among others.

Astoria Financial Company Profile

Astoria Financial Corporation is a unitary savings and loan holding company. The Company’s principal business is the operation of its subsidiary, Astoria Bank. Astoria Bank’s primary business is attracting retail deposits from the general public and businesses and investing those deposits, together with funds generated from operations, principal repayments on loans and securities and borrowings, primarily in multi-family and commercial real estate mortgage loans, one- to four-family, or residential, mortgage loans and mortgage-backed securities. Astoria Bank also invests in consumer and other loans, the United States Government, government agency and government-sponsored enterprise (GSE) securities, and other investments permitted by federal banking laws and regulations. Its loan portfolio consists primarily of mortgage loans, and consumer and other loans. The Company’s investment activities include securities available-for-sale and securities held-to-maturity.

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