Anchor Bancorp (NASDAQ: ANCB) and Astoria Financial Corporation (NYSE:AF) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, profitabiliy, analyst recommendations, earnings, dividends and risk.

Dividends

Astoria Financial Corporation pays an annual dividend of $0.16 per share and has a dividend yield of 0.8%. Anchor Bancorp does not pay a dividend. Astoria Financial Corporation pays out 27.6% of its earnings in the form of a dividend.

Volatility & Risk

Anchor Bancorp has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500. Comparatively, Astoria Financial Corporation has a beta of 0.6, meaning that its stock price is 40% less volatile than the S&P 500.

Institutional and Insider Ownership

40.2% of Anchor Bancorp shares are owned by institutional investors. Comparatively, 85.3% of Astoria Financial Corporation shares are owned by institutional investors. 6.5% of Anchor Bancorp shares are owned by insiders. Comparatively, 9.8% of Astoria Financial Corporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

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

Net Margins Return on Equity Return on Assets
Anchor Bancorp 8.58% 3.17% 0.46%
Astoria Financial Corporation 13.45% 4.26% 0.46%

Analyst Recommendations

This is a summary of current ratings and price targets for Anchor Bancorp and Astoria Financial Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Anchor Bancorp 0 1 0 0 2.00
Astoria Financial Corporation 1 2 1 0 2.00

Anchor Bancorp presently has a consensus target price of $25.00, indicating a potential downside of 0.20%. Astoria Financial Corporation has a consensus target price of $20.25, indicating a potential downside of 0.20%. Given Astoria Financial Corporation’s higher probable upside, analysts plainly believe Astoria Financial Corporation is more favorable than Anchor Bancorp.

Valuation & Earnings

This table compares Anchor Bancorp and Astoria Financial Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Anchor Bancorp $20.06 million 3.13 $2.10 million $0.84 29.82
Astoria Financial Corporation $389.11 million 5.25 $58.34 million $0.58 34.98

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

Summary

Astoria Financial Corporation beats Anchor Bancorp on 11 of the 14 factors compared between the two stocks.

Anchor Bancorp Company Profile

Anchor Bancorp is the bank holding company of Anchor Bank (the Bank). The Bank is a community-based savings bank. As of June 30, 2016, the Bank primarily served Western Washington through its 10 full-service banking offices (including a Wal-Mart in-store location) located within Grays Harbor, Thurston, Lewis, Pierce and Mason counties, and a loan production office located in King County, Washington. It is in the business of attracting deposits from the public and utilizing those deposits to originate loans. The Bank offers a range of loan products. The Bank’s operations include commercial banking services, such as lending activities, deposit products and other cash management services. The Bank offers commercial real estate loans and multi-family loans primarily in Western Washington. The Bank offers various deposit instruments, including checking accounts, money market deposit accounts, savings accounts and certificates of deposit with a range of rates.

Astoria Financial Corporation 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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