Lake Shore Bancorp (NASDAQ:LSBK – Get Free Report) and Kearny Financial (NASDAQ:KRNY – Get Free Report) 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, analyst recommendations, earnings, dividends, profitability, valuation and risk.
Risk and Volatility
Lake Shore Bancorp has a beta of 0.28, indicating that its stock price is 72% less volatile than the S&P 500. Comparatively, Kearny Financial has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500.
Profitability
This table compares Lake Shore Bancorp and Kearny Financial’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Lake Shore Bancorp | 20.74% | 5.95% | 1.15% |
| Kearny Financial | 10.45% | 4.92% | 0.49% |
Insider and Institutional Ownership
Dividends
Lake Shore Bancorp pays an annual dividend of $0.36 per share and has a dividend yield of 2.1%. Kearny Financial pays an annual dividend of $0.44 per share and has a dividend yield of 4.7%. Lake Shore Bancorp pays out 31.9% of its earnings in the form of a dividend. Kearny Financial pays out 77.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Lake Shore Bancorp and Kearny Financial, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Lake Shore Bancorp | 0 | 1 | 0 | 0 | 2.00 |
| Kearny Financial | 0 | 2 | 1 | 0 | 2.33 |
Kearny Financial has a consensus target price of $10.50, indicating a potential upside of 11.70%. Given Kearny Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Kearny Financial is more favorable than Lake Shore Bancorp.
Earnings & Valuation
This table compares Lake Shore Bancorp and Kearny Financial”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Lake Shore Bancorp | $39.56 million | 3.42 | $7.27 million | $1.13 | 15.22 |
| Kearny Financial | $347.14 million | 1.75 | $26.08 million | $0.57 | 16.49 |
Kearny Financial has higher revenue and earnings than Lake Shore Bancorp. Lake Shore Bancorp is trading at a lower price-to-earnings ratio than Kearny Financial, indicating that it is currently the more affordable of the two stocks.
Summary
Kearny Financial beats Lake Shore Bancorp on 9 of the 16 factors compared between the two stocks.
About Lake Shore Bancorp
Lake Shore Bancorp, Inc. operates as a savings and loan holding company for Lake Shore Servings Bank. It offers personal services such as checking, savings, lending, banking, debit card, e-services, and online banking; and business services including deposit products, commercial loans, and business e-statements. The company was founded in 2006 and is headquartered in Dunkirk, NY.
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.
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