Financial Analysis: Broadway Financial (NASDAQ:BYFC) vs. Kearny Financial (NASDAQ:KRNY)

Broadway Financial (NASDAQ:BYFC) and Kearny Financial (NASDAQ:KRNY) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, dividends, valuation, analyst recommendations, profitability and earnings.

Insider & Institutional Ownership

12.1% of Broadway Financial shares are owned by institutional investors. Comparatively, 71.0% of Kearny Financial shares are owned by institutional investors. 4.1% of Broadway Financial shares are owned by insiders. Comparatively, 7.4% of Kearny Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Broadway Financial	-36.31%	1.41%	0.14%
Kearny Financial	9.41%	4.26%	0.42%

Earnings and Valuation

This table compares Broadway Financial and Kearny Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Broadway Financial	$63.76 million	1.17	$1.93 million	($2.96)	-2.74
Kearny Financial	$343.53 million	1.49	$26.08 million	$0.52	15.25

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

Analyst Recommendations

This is a summary of recent recommendations and price targets for Broadway Financial and Kearny Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Broadway Financial	1	0	0	0	1.00
Kearny Financial	0	2	1	0	2.33

Kearny Financial has a consensus target price of $8.00, suggesting a potential upside of 0.88%. Given Kearny Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Kearny Financial is more favorable than Broadway Financial.

Risk & Volatility

Broadway Financial has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, Kearny Financial has a beta of 0.7, indicating that its stock price is 30% less volatile than the S&P 500.

Summary

Kearny Financial beats Broadway Financial on 13 of the 14 factors compared between the two stocks.

About Broadway Financial

Broadway Financial Corporation operates as the holding company for City First Bank, National Association that provides various banking products and services in the United States. It accepts various deposit accounts, including savings accounts, checking accounts, interest checking accounts, money market accounts, and fixed-term certificates of deposit. The company also offers mortgage loans, which are secured by multi-family residential properties; single family residential properties; and commercial real estate, including charter schools, community facilities, and churches, as well as commercial business, construction, and consumer loans. In addition, it invests in securities issued by federal government agencies, residential mortgage-backed securities, and other investments. The company was founded in 1946 and is headquartered in Los Angeles, California.

About Kearny Financial

Kearny Financial Corp. operates as the holding company for Kearny Bank that provides various banking products and services in the United States. It offers various deposit products, including interest-bearing and non-interest-bearing checking accounts, money market deposit accounts, savings accounts, and certificates of deposit accounts. The company also provides various loans, such as multi-family and nonresidential real estate mortgage loans, commercial term loans and lines of credit, one- to four-family residential mortgage loans, and home equity loans and lines of credit; loans to individuals, builders, or developers for the construction of multi-family residential buildings or commercial real estate, or for the construction or renovation of one- to four-family residences; overdraft lines of credit; and personal loans. In addition, it engages in the investment activities. Kearny Financial Corp. was founded in 1884 and is headquartered in Fairfield, New Jersey.