Broadway Financial (NASDAQ:BYFC) and Umpqua (NASDAQ:UMPQ) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, dividends, earnings and profitability.

Earnings & Valuation

This table compares Broadway Financial and Umpqua’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Broadway Financial $16.10 million 2.41 $810,000.00 N/A N/A
Umpqua $1.35 billion 2.79 $316.26 million $1.46 11.68

Umpqua has higher revenue and earnings than Broadway Financial.

Profitability

This table compares Broadway Financial and Umpqua’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Broadway Financial 6.93% 2.01% 0.23%
Umpqua 23.20% 7.91% 1.19%

Analyst Ratings

This is a breakdown of recent ratings for Broadway Financial and Umpqua, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Broadway Financial 0 0 0 0 N/A
Umpqua 0 5 3 0 2.38

Umpqua has a consensus price target of $23.00, suggesting a potential upside of 34.82%. Given Umpqua’s higher possible upside, analysts plainly believe Umpqua is more favorable than Broadway Financial.

Insider & Institutional Ownership

9.1% of Broadway Financial shares are held by institutional investors. Comparatively, 89.3% of Umpqua shares are held by institutional investors. 2.7% of Broadway Financial shares are held by insiders. Comparatively, 0.4% of Umpqua shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Umpqua pays an annual dividend of $0.84 per share and has a dividend yield of 4.9%. Broadway Financial does not pay a dividend. Umpqua pays out 57.5% of its earnings in the form of a dividend. Umpqua has increased its dividend for 8 consecutive years.

Volatility & Risk

Broadway Financial has a beta of 1.16, meaning that its share price is 16% more volatile than the S&P 500. Comparatively, Umpqua has a beta of 1.08, meaning that its share price is 8% more volatile than the S&P 500.

Summary

Umpqua beats Broadway Financial on 11 of the 15 factors compared between the two stocks.

About Broadway Financial

Broadway Financial Corporation operates as the holding company for Broadway Federal Bank, f.s.b. that engages in the savings and loan business in Southern California. It accepts various deposit products, such as savings accounts, checking accounts, NOW accounts, money market accounts, and fixed-term certificates of deposit. The company also provides loan products, including multi-family mortgage, single family mortgage, commercial real estate, church, construction, commercial, and consumer loans. In addition, it invests in securities issued by federal government agencies, residential mortgage-backed securities, and other investments. The company operates through three branch offices comprising two offices in Los Angeles and one in Inglewood, California. Broadway Financial Corporation was founded in 1946 and is headquartered in Los Angeles, California.

About Umpqua

Umpqua Holdings Corporation operates as the holding company of Umpqua Bank that provides commercial and retail banking, and retail brokerage services. It operates through four segments: Wholesale Bank, Wealth Management, Retail Bank, and Home Lending. The company offers deposit products, including non-interest bearing checking, interest bearing checking and savings, and money market accounts, as well as certificates of deposit. It also provides loans for corporate and commercial customers, such as accounts receivable and inventory financing, multi-family and equipment loans, commercial equipment leases, international trade, real estate construction loans, permanent financing products, and small business administration program financing, as well as capital markets and treasury management services. In addition, the company offers loan products for small businesses; commercial and industrial loans; residential real estate loans for the construction, purchase, and refinancing of residential owner-occupied and rental properties; and consumer loans comprising secured and unsecured personal loans, home equity and personal lines of credit, and motor vehicle loans. Further, it provides financial planning, trust, and investment services; treasury and cash management services; retail brokerage and investment advisory services; and digital, mobile, telephone, text, and online banking services. The company serves middle market corporate, commercial, and business banking customers; individual investors; and high net worth individuals. As of December 31, 2018, it operated commercial banking centers in 299 locations in Oregon, Washington, California, Idaho, and Nevada. The company was founded in 1953 and is headquartered in Portland, Oregon.

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