OptimumBank (NASDAQ:OPHC) & Eastern Bankshares (NASDAQ:EBC) Critical Analysis

OptimumBank (NASDAQ:OPHC) and Eastern Bankshares (NASDAQ:EBC) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, dividends, valuation, profitability, risk, earnings and institutional ownership.

Insider & Institutional Ownership

7.4% of OptimumBank shares are held by institutional investors. Comparatively, 71.7% of Eastern Bankshares shares are held by institutional investors. 18.7% of OptimumBank shares are held by insiders. Comparatively, 1.3% of Eastern Bankshares shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares OptimumBank and Eastern Bankshares”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OptimumBank	$58.79 million	1.93	$6.28 million	$0.87	10.34
Eastern Bankshares	$1.19 billion	4.34	$397.61 million	$1.74	12.98

Eastern Bankshares has higher revenue and earnings than OptimumBank. OptimumBank is trading at a lower price-to-earnings ratio than Eastern Bankshares, 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 OptimumBank and Eastern Bankshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OptimumBank	0	0	3	1	3.25
Eastern Bankshares	0	3	6	0	2.67

OptimumBank presently has a consensus target price of $6.67, suggesting a potential downside of 25.93%. Eastern Bankshares has a consensus target price of $25.00, suggesting a potential upside of 10.72%. Given Eastern Bankshares’ higher possible upside, analysts clearly believe Eastern Bankshares is more favorable than OptimumBank.

Volatility & Risk

OptimumBank has a beta of 0.31, indicating that its share price is 69% less volatile than the S&P 500. Comparatively, Eastern Bankshares has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500.

Profitability

This table compares OptimumBank and Eastern Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OptimumBank	19.62%	14.10%	1.31%
Eastern Bankshares	N/A	N/A	N/A

Summary

Eastern Bankshares beats OptimumBank on 9 of the 15 factors compared between the two stocks.

About OptimumBank

OptimumBank Holdings, Inc. operates as the bank holding company for OptimumBank that provides various consumer and commercial banking services to individuals and businesses. It accepts demand interest-bearing and noninterest-bearing, savings, money market, and NOW accounts, as well as time deposits, wire transfers, ACH services, and certificates of deposit. The company also offers residential and commercial real estate, multi-family real estate, land and construction loans; commercial loans are generally used for working capital purposes or for acquiring equipment, inventory, and furniture; and consumer loans for various purposes, including purchases of automobiles, recreational vehicles, boats, home improvements, lines of credit, personal, and deposit account collateralized loans. In addition, it provides Visa debit and ATM cards; cash management, notary, and night depository services; and direct deposits, money orders, cashier's checks, domestic collections, and banking by mail, as well as internet banking services. The company was founded in 2000 and is based in Fort Lauderdale, Florida.

About Eastern Bankshares

Eastern Bankshares, Inc. operates as the bank holding company for Eastern Bank that provides banking products and services primarily to retail, commercial, and small business customers. The company provides deposit accounts, interest checking accounts, money market accounts, savings accounts, and time certificates of deposit accounts. It also offers commercial and industrial, commercial real estate and construction, small business, residential real estate, and home equity loans; lines of credit; and other consumer loans comprising unsecured personal lines of credit, overdraft protection, automobile loans, home improvement loans, airplane loans, and other personal loans. In addition, the company provides trust, financial planning and portfolio management, automated lock box collection, cash management, and account reconciliation services; personal, business, and employee benefits insurance products. Eastern Bankshares, Inc. was founded in 1818 and is headquartered in Boston, Massachusetts.