Financial Analysis: KB Financial Group (NYSE:KB) & Eagle Bancorp Montana (NASDAQ:EBMT)

Eagle Bancorp Montana (NASDAQ:EBMT) and KB Financial Group (NYSE:KB) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, dividends, earnings and risk.

Risk & Volatility

Eagle Bancorp Montana has a beta of 0.35, meaning that its stock price is 65% less volatile than the S&P 500. Comparatively, KB Financial Group has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500.

Valuation and Earnings

This table compares Eagle Bancorp Montana and KB Financial Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eagle Bancorp Montana	$127.08 million	1.41	$14.84 million	$2.04	10.99
KB Financial Group	$23.41 billion	2.01	$4.04 billion	$11.65	11.40

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Eagle Bancorp Montana and KB Financial Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eagle Bancorp Montana	0	3	1	0	2.25
KB Financial Group	0	0	2	1	3.33

Eagle Bancorp Montana presently has a consensus price target of $23.50, suggesting a potential upside of 4.86%. Given Eagle Bancorp Montana’s higher probable upside, equities analysts plainly believe Eagle Bancorp Montana is more favorable than KB Financial Group.

Insider and Institutional Ownership

35.7% of Eagle Bancorp Montana shares are owned by institutional investors. Comparatively, 11.5% of KB Financial Group shares are owned by institutional investors. 5.8% of Eagle Bancorp Montana shares are owned by company insiders. Comparatively, 69.0% of KB Financial Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Eagle Bancorp Montana and KB Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eagle Bancorp Montana	12.57%	8.36%	0.76%
KB Financial Group	17.67%	10.11%	0.76%

Dividends

Eagle Bancorp Montana pays an annual dividend of $0.59 per share and has a dividend yield of 2.6%. KB Financial Group pays an annual dividend of $2.70 per share and has a dividend yield of 2.0%. Eagle Bancorp Montana pays out 28.9% of its earnings in the form of a dividend. KB Financial Group pays out 23.2% 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. Eagle Bancorp Montana has raised its dividend for 14 consecutive years. Eagle Bancorp Montana is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

KB Financial Group beats Eagle Bancorp Montana on 13 of the 17 factors compared between the two stocks.

About Eagle Bancorp Montana

Eagle Bancorp Montana, Inc. operates as the bank holding company for Opportunity Bank of Montana that provides various retail banking products and services to small businesses and individuals in Montana. It accepts various deposit products, such as checking, savings, money market, and individual retirement accounts, as well as certificates of deposit accounts. The company also provides 1-4 family residential mortgage loans, such as residential mortgages and construction of residential properties; commercial real estate loans, including multi-family dwellings, nonresidential property, commercial construction and development, and farmland loans; and second mortgage/home equity loans. In addition, it offers consumer loans, such as loans secured by collateral other than real estate, such as automobiles, recreational vehicles, and boats; personal loans and lines of credit; commercial business loans consisting of business loans and lines of credit on a secured and unsecured basis; construction loans; agricultural loans; and mortgage loan services. The company operates full-service branches and automated teller machines. Eagle Bancorp Montana, Inc. was founded in 1922 and is headquartered in Helena, Montana.

About KB Financial Group

KB Financial Group Inc. provides a range of banking and related financial services to consumers and corporations in South Korea, the United States, New Zealand, China, Cambodia, the United Kingdom, Indonesia, and internationally. The company operates through Retail Banking, Corporate Banking, Other Banking Services, Credit Card, Securities, Life Insurance, and Non-Life Insurance segments. It offers loans, deposit products, and other related financial products and services to large, small, medium-sized enterprises, and small office/home office, as well as individuals and households; investment banking, and brokerage and supporting services; life insurance products; non-life insurance products, including fire, maritime, injury, technology, liability, package, title, guarantee, other special type insurances, automobile, long-term nonlife, property damage, injury, driver, savings, illness, nursing, pension, and others; and credit sale, cash service, card loan, and other supporting services. The company also engages in securities and derivatives trading, funding, and other supporting activities. In addition, it offers foreign exchange transaction; financial investment; credit card and installment financing; financial leasing; auto Installment finance; real estate trust management; capital and collective investment; collection of receivables or credit investigation; software advisory, development, and supply; microfinance; investment advisory; claim; management; savings banking; information and communication; e-commerce; and general advisory services. The company was founded in 1963 and is headquartered in Seoul, South Korea.