Investors are weighing the merits of two small-cap finance companies, Malaga Financial and Oak Valley Bancorp, as they seek opportunities in the current market. A comparison of key financial metrics indicates that Oak Valley Bancorp may offer a more compelling investment option.
Risk and Volatility Assessment
According to recent data, Malaga Financial has a beta of 0.09, indicating that its stock price is approximately 91% less volatile than the S&P 500 index. In contrast, Oak Valley Bancorp has a beta of 0.25, suggesting a volatility reduction of around 75% compared to the broader market. This lower volatility may appeal to risk-averse investors.
Ownership and Institutional Backing
Ownership structures also differ significantly between the two companies. Only 1.2% of Malaga Financial shares are held by institutional investors, while Oak Valley Bancorp boasts a strong institutional ownership rate of 30.9%. In addition, 18.1% of shares in Oak Valley are owned by company insiders. High institutional ownership is often viewed as a positive indicator, suggesting that large investors believe in the company’s growth potential.
Earnings, Valuation, and Analyst Recommendations
In terms of earnings, Oak Valley Bancorp outperforms Malaga Financial with higher revenue figures. Furthermore, Oak Valley trades at a lower price-to-earnings (P/E) ratio, making it the more attractive option from a valuation standpoint. Recent analyst recommendations, as reported by MarketBeat, have generally favored Oak Valley, contributing to its appeal among investors.
Profitability and Dividend Analysis
When examining profitability, both companies present solid metrics. However, Malaga Financial offers an annual dividend of $1.00 per share, translating to a dividend yield of 4.4%. Conversely, Oak Valley Bancorp pays an annual dividend of $0.60 per share, with a yield of 2.1%. Notably, Malaga Financial distributes 43.5% of its earnings as dividends, while Oak Valley’s payout ratio is a more conservative 21.1%. Despite the differences, both companies maintain healthy payout ratios, suggesting they can sustain these dividends in the coming years. Additionally, Oak Valley has a consistent track record, having increased its dividend for 11 consecutive years.
Conclusion: A Clear Leader Emerges
Overall, Oak Valley Bancorp surpasses Malaga Financial in 13 out of 15 comparison factors. With stronger financial performance, lower valuation metrics, and a more robust institutional backing, Oak Valley presents a more favorable investment opportunity for those looking to enter the small-cap finance sector.
Malaga Financial Corporation, established in 2002 and headquartered in Palos Verdes Estates, California, operates as the holding company for Malaga Bank, offering various community banking products. On the other hand, Oak Valley Bancorp, incorporated in 1990 and based in Oakdale, California, serves the Central Valley and Eastern Sierra regions, providing a range of commercial banking services.
Investors should consider these factors carefully when deciding between the two companies.
