Financial Review: RBB Bancorp (NASDAQ:RBB) vs. Hanover Bancorp (NASDAQ:HNVR)

Hanover Bancorp (NASDAQ:HNVR) and RBB Bancorp (NASDAQ:RBB) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, dividends and profitability.

Profitability

This table compares Hanover Bancorp and RBB Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hanover Bancorp	8.32%	6.71%	0.54%
RBB Bancorp	11.49%	5.21%	0.68%

Dividends

Hanover Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 1.9%. RBB Bancorp pays an annual dividend of $0.64 per share and has a dividend yield of 4.2%. Hanover Bancorp pays out 24.1% of its earnings in the form of a dividend. RBB Bancorp pays out 43.8% 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.

Institutional & Insider Ownership

15.0% of Hanover Bancorp shares are owned by institutional investors. Comparatively, 40.1% of RBB Bancorp shares are owned by institutional investors. 24.8% of Hanover Bancorp shares are owned by insiders. Comparatively, 6.6% of RBB Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

Hanover Bancorp has a beta of 0.11, indicating that its share price is 89% less volatile than the S&P 500. Comparatively, RBB Bancorp has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500.

Valuation and Earnings

This table compares Hanover Bancorp and RBB Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hanover Bancorp	$68.43 million	2.18	$12.35 million	$1.66	12.47
RBB Bancorp	$114.70 million	2.33	$26.67 million	$1.46	10.33

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

Analyst Ratings

This is a breakdown of recent ratings and target prices for Hanover Bancorp and RBB Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hanover Bancorp	0	1	1	0	2.50
RBB Bancorp	0	4	0	0	2.00

Hanover Bancorp presently has a consensus price target of $22.00, suggesting a potential upside of 6.28%. RBB Bancorp has a consensus price target of $21.25, suggesting a potential upside of 40.92%. Given RBB Bancorp’s higher probable upside, analysts plainly believe RBB Bancorp is more favorable than Hanover Bancorp.

Summary

RBB Bancorp beats Hanover Bancorp on 9 of the 16 factors compared between the two stocks.

About Hanover Bancorp

Hanover Bancorp, Inc., a bank holding company for Hanover Community Bank, provides personal and business lending and deposit services to businesses, municipalities, and individuals in the New York metro area. The company offers checking, credit cards, debit cards, money market, savings, government and municipal banking, and professional services, as well as time deposits, including certificate of deposit and individual retirement accounts. It also provides business loans, commercial real estate financing, small business administration, lending directory services, and residential mortgage. In addition, the company offers cash management, online and mobile banking, merchant services, and digital solutions. Its banking offices are located in Nassau, Suffolk, Queens, Kings, New York Counties, New York, Monmouth County, Freehold, and New Jersey. The company was founded in 2008 and is headquartered in Mineola, New York.

About RBB Bancorp

RBB Bancorp operates as the bank holding company for Royal Business Bank that provides various banking products and services to the Chinese-American, Korean-American, and other Asian-American communities. Its deposit products include checking, savings, and money market accounts, as well as certificates of deposit. The company also offers commercial and industrial lines of credit, term loans, mortgage warehouse lines, and international trade discounts; commercial real estate loans; residential, commercial, and land acquisition and development construction loans; small business administration loans; and single-family residential mortgage loans. In addition, it provides international letters of credit, SWIFT, export advisory, trade finance discount, and foreign exchange services; and remote deposit, e-banking, and mobile banking services. The company serves individuals, businesses, municipalities, and other entities. It operates branches in the Western region with branches in Los Angeles County, California; Orange County, California; Ventura County, California; Clark County, Nevada; Honolulu, Hawaii, as well as in Eastern region with branches in Manhattan, Brooklyn and Queens, New York; Chicago, Illinois; and Edison, New Jersey. RBB Bancorp was founded in 2008 and is headquartered in Los Angeles, California.