Reviewing Northeast Bancorp (NASDAQ:NBN) & CVB Financial (NASDAQ:CVBF)

Northeast Bancorp (NASDAQ:NBN) and CVB Financial (NASDAQ:CVBF) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, dividends, risk, profitability and institutional ownership.

Analyst Ratings

This is a summary of recent recommendations for Northeast Bancorp and CVB Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northeast Bancorp	0	1	2	0	2.67
CVB Financial	0	1	4	0	2.80

Northeast Bancorp currently has a consensus price target of $143.50, suggesting a potential upside of 11.46%. CVB Financial has a consensus price target of $26.25, suggesting a potential upside of 14.53%. Given CVB Financial’s stronger consensus rating and higher probable upside, analysts plainly believe CVB Financial is more favorable than Northeast Bancorp.

Volatility and Risk

Northeast Bancorp has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500. Comparatively, CVB Financial has a beta of 0.66, indicating that its share price is 34% less volatile than the S&P 500.

Earnings and Valuation

This table compares Northeast Bancorp and CVB Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northeast Bancorp	$385.07 million	2.74	$107.48 million	$12.72	10.12
CVB Financial	$648.47 million	6.22	$209.30 million	$1.45	15.81

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

Institutional and Insider Ownership

74.2% of CVB Financial shares are owned by institutional investors. 14.2% of Northeast Bancorp shares are owned by insiders. Comparatively, 6.4% of CVB Financial shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Northeast Bancorp pays an annual dividend of $0.04 per share and has a dividend yield of 0.0%. CVB Financial pays an annual dividend of $0.80 per share and has a dividend yield of 3.5%. Northeast Bancorp pays out 0.3% of its earnings in the form of a dividend. CVB Financial pays out 55.2% 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.

Profitability

This table compares Northeast Bancorp and CVB Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northeast Bancorp	27.91%	19.35%	2.22%
CVB Financial	29.54%	9.91%	1.47%

Summary

CVB Financial beats Northeast Bancorp on 11 of the 16 factors compared between the two stocks.

About Northeast Bancorp

Northeast Bank provides banking services to individual and corporate customers in Maine. The company's deposit products include demand deposit, NOW, money market, savings, certificate of deposit, and individual retirement accounts, as well as checking accounts. Its loan portfolio comprises residential mortgage loans; multi-family and other commercial real estate loans; commercial and industrial loans, such as term loans, lines of credit and equipment, and receivables financing; consumer loans comprising mobile home and overdraft, and deposit-secured loans; and small business administration loans. In addition, the company offers telephone banking, online banking and bill payment, mobile banking, cash management, and remote deposit capture services, as well as debit and credit card, ATM, electronic transfer, and check services. Further, it provides various services, such as money market, merchant, and payroll and HR. Northeast Bank was founded in 1872 and is headquartered in Portland, Maine.

About CVB Financial

CVB Financial Corp. operates as a bank holding company for Citizens Business Bank, a state-chartered bank that provides banking and financial services to small to mid-sized businesses and individuals. It offers checking, savings, money market, and time certificates of deposit products for business and personal accounts; and serves as a federal tax depository for business customers. The company also provides commercial lending products comprising lines of credit and other working capital financing, accounts receivable lending, and letters of credit; agriculture loans to finance the operating needs of wholesale dairy farm operations, cattle feeders, livestock raisers, and farmers; lease financing services for municipal governments; commercial real estate and construction loans; and consumer financing products, including automobile leasing and financing, lines of credit, credit cards, home mortgages, and home equity loans and lines of credit. In addition, it offers various specialized services, such as treasury management systems for monitoring cash flow, merchant card processing program, armored pick-up and delivery, payroll services, remote deposit capture, electronic funds transfers, wires and automated clearinghouse, and online account access. Further, the company provides trust services, such as fiduciary services, mutual funds, annuities, 401(k) plans, and individual investment accounts. CVB Financial Corp. was founded in 1974 and is headquartered in Ontario, California.