Sterling Bancorp (NASDAQ:SBT) and Brookline Bancorp (NASDAQ:BRKL) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, risk and institutional ownership.
Risk & Volatility
Get Sterling Bancorp alerts:Sterling Bancorp has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500. Comparatively, Brookline Bancorp has a beta of 0.91, suggesting that its share price is 9% less volatile than the S&P 500.
Earnings & Valuation
This table compares Sterling Bancorp and Brookline Bancorp’s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sterling Bancorp | $183.81 million | 2.91 | $63.47 million | N/A | N/A |
| Brookline Bancorp | $339.12 million | 3.79 | $83.06 million | $1.07 | 14.93 |
Brookline Bancorp has higher revenue and earnings than Sterling Bancorp.
Dividends
Sterling Bancorp pays an annual dividend of $0.04 per share and has a dividend yield of 0.4%. Brookline Bancorp pays an annual dividend of $0.42 per share and has a dividend yield of 2.6%. Brookline Bancorp pays out 39.3% of its earnings in the form of a dividend.
Insider and Institutional Ownership
31.5% of Sterling Bancorp shares are held by institutional investors. Comparatively, 75.0% of Brookline Bancorp shares are held by institutional investors. 3.0% of Sterling Bancorp shares are held by insiders. Comparatively, 2.5% of Brookline Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Profitability
This table compares Sterling Bancorp and Brookline Bancorp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sterling Bancorp | 34.53% | 20.88% | 2.04% |
| Brookline Bancorp | 24.49% | 9.58% | 1.17% |
Analyst Recommendations
This is a breakdown of current ratings and target prices for Sterling Bancorp and Brookline Bancorp, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sterling Bancorp | 0 | 0 | 1 | 0 | 3.00 |
| Brookline Bancorp | 0 | 3 | 0 | 0 | 2.00 |
Sterling Bancorp currently has a consensus target price of $13.00, indicating a potential upside of 28.84%. Brookline Bancorp has a consensus target price of $17.75, indicating a potential upside of 11.08%. Given Sterling Bancorp’s stronger consensus rating and higher possible upside, research analysts clearly believe Sterling Bancorp is more favorable than Brookline Bancorp.
Summary
Sterling Bancorp beats Brookline Bancorp on 9 of the 15 factors compared between the two stocks.
About Sterling Bancorp
Sterling Bancorp, Inc. is a unitary thrift holding company. Its wholly owned subsidiary, Sterling Bank and Trust, F.S.B., has primary branch operations in San Francisco and Los Angeles, California and New York City, and a loan production office in Seattle, Washington. Sterling offers a broad range of loan products to the residential and commercial markets, as well as retail and business banking services. Sterling also has an operations center and a branch in Southfield, Michigan. Sterling was named as the top performing community bank in the United States with total assets between $1 billion and $10 billion in 2017 by SNL/S&P Global Market Intelligence.
About Brookline Bancorp
Brookline Bancorp, Inc. operates as the holding company for Brookline Bank, Bank Rhode Island, First Ipswich Bank, and Brookline Securities Corp that provide commercial, business, and retail banking services to corporate, municipal, and retail customers in the United States. Its deposit products include non-interest-bearing demand checking accounts, NOW accounts, savings accounts, and money market accounts. The company's loan portfolio comprises first mortgage loans secured by commercial, multi-family, and residential real estate properties; loans to business entities comprising commercial lines of credit; loans to condominium associations; loans and leases used to finance equipment used by small businesses; financing for construction and development projects; and home equity and other consumer loans. It also provides cash management, investment advisory, and online banking services, as well as invests in debt and equity securities. As of December 31, 2017, the Company operated 51 full-service banking offices in greater Boston, the north shore of Massachusetts, and Rhode Island. Brookline Bancorp, Inc. was founded in 1871 and is headquartered in Boston, Massachusetts.
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