Head to Head Comparison: Sierra Bancorp (BSRR) versus HopFed Bancorp (HFBC)

Sierra Bancorp (NASDAQ: BSRR) and HopFed Bancorp (NASDAQ:HFBC) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, earnings, risk, profitability, valuation and dividends.

Dividends

Sierra Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 2.2%. HopFed Bancorp pays an annual dividend of $0.20 per share and has a dividend yield of 1.2%. Sierra Bancorp pays out 41.3% of its earnings in the form of a dividend. HopFed Bancorp pays out 26.3% 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.

Volatility & Risk

Sierra Bancorp has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, HopFed Bancorp has a beta of 0.21, indicating that its stock price is 79% less volatile than the S&P 500.

Earnings & Valuation

This table compares Sierra Bancorp and HopFed Bancorp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sierra Bancorp $102.70 million 4.36 $19.53 million $1.55 18.92
HopFed Bancorp $41.78 million 2.59 $3.30 million $0.76 21.38

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

Insider & Institutional Ownership

51.3% of Sierra Bancorp shares are owned by institutional investors. Comparatively, 47.8% of HopFed Bancorp shares are owned by institutional investors. 10.2% of Sierra Bancorp shares are owned by company insiders. Comparatively, 4.1% of HopFed Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Sierra Bancorp and HopFed Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sierra Bancorp 20.04% 10.31% 1.10%
HopFed Bancorp 9.30% 5.54% 0.53%

Analyst Ratings

This is a summary of recent recommendations and price targets for Sierra Bancorp and HopFed Bancorp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sierra Bancorp 0 3 2 0 2.40
HopFed Bancorp 0 0 0 0 N/A

Sierra Bancorp presently has a consensus target price of $28.80, suggesting a potential downside of 1.77%. Given Sierra Bancorp’s higher possible upside, equities research analysts plainly believe Sierra Bancorp is more favorable than HopFed Bancorp.

Summary

Sierra Bancorp beats HopFed Bancorp on 13 of the 15 factors compared between the two stocks.

About Sierra Bancorp

Sierra Bancorp operates as the bank holding company for Bank of the Sierra that provides retail and commercial banking services to individuals and businesses in California. The company accepts various deposit products, such as checking accounts, savings accounts, money market demand accounts, time deposits, retirement accounts, and sweep accounts. Its loan products include real estate loans secured by commercial, professional office, and agricultural properties; construction loans for residential and commercial development; permanent mortgage loans, land acquisition and development loans, and multifamily credit facilities; secondary market services for residential mortgage loans; agricultural production loans; commercial and industrial loans and leases, including SBA loans and direct finance leases; mortgage warehouse loans; and consumer loans. The company also offers automated teller machines; electronic point-of-sale payment alternatives; online and automated telephone banking services; and remote deposit capture and automated payroll services for business customers. As of December 31, 2017, it operated 39 full service branches, an online branch, a real estate industries center, an agricultural credit center, and an SBA lending unit. Sierra Bancorp was founded in 1977 and is headquartered in Porterville, California.

About HopFed Bancorp

HopFed Bancorp, Inc. operates as the bank holding company for Heritage Bank USA, Inc. that provides various banking products and services. The company accepts various deposit products, including money market accounts, passbook savings accounts, individual retirement accounts, certificates of deposit, and time deposits, as well as non-interest bearing, savings, and interest bearing checking accounts. It also provides loans, such as one-to-four family first mortgages, home equity lines of credit, junior liens, multi-family loans, construction and land loans, non-residential real estate loans, and farm loans, as well as secured and unsecured consumer and commercial loans. In addition, the company owns a low income senior citizen housing facility that offers apartments for rent in Bowling Green, Kentucky. Further, it invests in the United States government agency securities, municipal and corporate bonds, collateralized mortgages obligations, and mortgage-backed securities. As of March 21, 2018, the company operated 18 offices in western Kentucky and middle Tennessee; Heritage Bank Wealth Management of Murray, Kentucky, Hopkinsville, Kentucky, Kingston Springs, Tennessee, and Clarksville, Tennessee; and Heritage Mortgage Services of Clarksville, Tennessee, as well as loan production offices in Nashville, Tennessee, and Brentwood, Tennessee. HopFed Bancorp, Inc. was founded in 1879 and is headquartered in Hopkinsville, Kentucky.

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