Critical Survey: Bank of Marin Bancorp (NASDAQ:BMRC) and WaFd (NASDAQ:WAFD)

WaFd (NASDAQ:WAFD) and Bank of Marin Bancorp (NASDAQ:BMRC) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Valuation and Earnings

This table compares WaFd and Bank of Marin Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
WaFd	$1.41 billion	2.01	$226.07 million	$3.06	12.54
Bank of Marin Bancorp	$163.98 million	2.74	-$35.67 million	($2.02)	-13.72

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

Volatility and Risk

WaFd has a beta of 0.84, indicating that its stock price is 16% less volatile than the S&P 500. Comparatively, Bank of Marin Bancorp has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500.

Profitability

This table compares WaFd and Bank of Marin Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
WaFd	18.25%	8.94%	0.90%
Bank of Marin Bancorp	-18.58%	7.20%	0.78%

Analyst Recommendations

This is a summary of recent ratings and target prices for WaFd and Bank of Marin Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WaFd	0	5	1	0	2.17
Bank of Marin Bancorp	1	3	2	0	2.17

WaFd presently has a consensus target price of $34.80, suggesting a potential downside of 9.30%. Bank of Marin Bancorp has a consensus target price of $28.40, suggesting a potential upside of 2.47%. Given Bank of Marin Bancorp’s higher probable upside, analysts plainly believe Bank of Marin Bancorp is more favorable than WaFd.

Insider & Institutional Ownership

83.7% of WaFd shares are owned by institutional investors. Comparatively, 52.3% of Bank of Marin Bancorp shares are owned by institutional investors. 1.5% of WaFd shares are owned by insiders. Comparatively, 5.7% of Bank of Marin Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

WaFd pays an annual dividend of $1.08 per share and has a dividend yield of 2.8%. Bank of Marin Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 3.6%. WaFd pays out 35.3% of its earnings in the form of a dividend. Bank of Marin Bancorp pays out -49.5% 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. WaFd has increased its dividend for 2 consecutive years. Bank of Marin Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

WaFd beats Bank of Marin Bancorp on 10 of the 16 factors compared between the two stocks.

About WaFd

WaFd, Inc operates as the bank holding company for Washington Federal Bank that provides lending, depository, insurance, and other banking services in the United States. The company offers deposit products, including business and personal checking accounts, and term certificates of deposit, as well as money market accounts and passbook savings accounts. It also provides single-family dwellings, construction, land acquisition and development, consumer lot, multi-family residential, commercial real estate, home equity, business, and consumer loans, as well as commercial and industrial loans. In addition, the company offers insurance brokerage services, such as individual and business insurance policies; holds and markets real estate properties; and debit and credit cards, as well as acts as the trustee. It serves consumers, mid-sized and large businesses, and owners and developers of commercial real estate. The company was formerly known as Washington Federal, Inc. and changed its name to WaFd, Inc in September 2023. WaFd, Inc was founded in 1917 and is headquartered in Seattle, Washington.

About Bank of Marin Bancorp

Bank of Marin Bancorp operates as the holding company for Bank of Marin that provides a range of financial services primarily to small to medium-sized businesses, not-for-profit organizations, and commercial real estate investors in the United States. The company offers personal and business checking and savings accounts; and individual retirement, health savings, and demand deposit marketplace accounts, as well as time certificates of deposit, certificate of deposit account registry, and insured cash sweep services. It also provides commercial real estate, commercial and industrial, and consumer loans, as well as construction financing and home equity lines of credit. In addition, the company offers merchant and payroll services; commercial equipment leasing program; payment solutions; treasury management services; credit cards; and mobile deposit, remote deposit capture, automated clearing house, wire transfer, and image lockbox services. Further, it provides wealth management and trust services comprising customized investment portfolio management, financial planning, trust administration, estate settlement, and custody services, as well as 401(k) plan services; and automated teller machines, and telephone and digital banking services. The company was incorporated in 1989 and is headquartered in Novato, California.