Home Financial Bancorp (OTCMKTS:HWEN) and Berkshire Hills Bancorp (NYSE:BHLB) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, risk, valuation, earnings and dividends.

Risk & Volatility

Home Financial Bancorp has a beta of 0.18, meaning that its stock price is 82% less volatile than the S&P 500. Comparatively, Berkshire Hills Bancorp has a beta of 0.95, meaning that its stock price is 5% less volatile than the S&P 500.

Dividends

Home Financial Bancorp pays an annual dividend of $0.16 per share and has a dividend yield of 2.5%. Berkshire Hills Bancorp pays an annual dividend of $0.88 per share and has a dividend yield of 2.7%. Berkshire Hills Bancorp pays out 38.4% of its earnings in the form of a dividend. Berkshire Hills Bancorp has raised its dividend for 3 consecutive years. Berkshire Hills Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current ratings and price targets for Home Financial Bancorp and Berkshire Hills Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Home Financial Bancorp 0 0 0 0 N/A
Berkshire Hills Bancorp 0 4 1 0 2.20

Berkshire Hills Bancorp has a consensus price target of $40.63, indicating a potential upside of 26.13%. Given Berkshire Hills Bancorp’s higher possible upside, analysts clearly believe Berkshire Hills Bancorp is more favorable than Home Financial Bancorp.

Profitability

This table compares Home Financial Bancorp and Berkshire Hills Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Home Financial Bancorp N/A N/A N/A
Berkshire Hills Bancorp 15.64% 8.33% 1.04%

Insider & Institutional Ownership

74.7% of Berkshire Hills Bancorp shares are held by institutional investors. 93.4% of Home Financial Bancorp shares are held by insiders. Comparatively, 1.6% of Berkshire Hills Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Home Financial Bancorp and Berkshire Hills Bancorp’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Home Financial Bancorp N/A N/A $160,000.00 N/A N/A
Berkshire Hills Bancorp $485.95 million 3.01 $55.24 million $2.29 14.07

Berkshire Hills Bancorp has higher revenue and earnings than Home Financial Bancorp.

Summary

Berkshire Hills Bancorp beats Home Financial Bancorp on 11 of the 14 factors compared between the two stocks.

Home Financial Bancorp Company Profile

Home Financial Bancorp operates as a holding company for Our Community Bank that offers various banking products and services in the United States. The company offers various deposits products, including demand deposits, savings accounts, NOW accounts, and money market deposits; commercial and industrial loans, nonresidential real estate loans, and residential, mobile home and land, and consumer loans. It also provides auto and hazard insurance; and Internet banking services. The company provides banking services primarily in Owen, Putnam, and other counties. Home Financial Bancorp was founded in 1911 and is based in Spencer, Indiana.

Berkshire Hills Bancorp Company Profile

Berkshire Hills Bancorp, Inc. operates as a bank holding company for Berkshire Bank that provides various banking products and services. It offers various deposit accounts, including demand deposit, NOW, regular savings, money market savings, time certificates of deposit, and retirement deposit accounts; and loans, such as commercial real estate, commercial and industrial, consumer, and residential mortgage loans. The company also provides wealth management services comprising investment management, trust administration, and estate planning; and investment products, financial planning, and brokerage services. In addition, it provides retail and commercial electronic banking, commercial cash management, online banking, and mobile banking services; interest rate swaps; and debit cards and other electronic fee producing payment services to transaction account customers. Further, the company, through its subsidiary, Berkshire Insurance Group, Inc., offers personal and commercial property, and casualty insurance; employee benefits insurance; and life, health, and financial services insurance products. It serves retail, commercial, not- profit, and municipal deposit customers. As of December 31, 2017, the company operated 113 full-service branches in Massachusetts, New York, Connecticut, Vermont, Central New Jersey, and Eastern Pennsylvania. Berkshire Hills Bancorp, Inc. was founded in 1846 and is headquartered in Boston, Massachusetts.

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