Reviewing Kearny Financial (KRNY) and Northrim BanCorp (NRIM)

Kearny Financial (NASDAQ: KRNY) and Northrim BanCorp (NASDAQ:NRIM) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.

Profitability

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This table compares Kearny Financial and Northrim BanCorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kearny Financial	9.92%	2.01%	0.42%
Northrim BanCorp	13.47%	8.45%	1.08%

Analyst Recommendations

This is a summary of current ratings and price targets for Kearny Financial and Northrim BanCorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kearny Financial	1	0	0	0	1.00
Northrim BanCorp	0	0	0	0	N/A

Kearny Financial presently has a consensus price target of $13.50, indicating a potential downside of 2.53%. Given Kearny Financial’s higher possible upside, research analysts clearly believe Kearny Financial is more favorable than Northrim BanCorp.

Valuation and Earnings

This table compares Kearny Financial and Northrim BanCorp’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kearny Financial	$150.44 million	9.43	$18.60 million	N/A	N/A
Northrim BanCorp	$100.58 million	2.75	$13.15 million	$2.04	19.73

Kearny Financial has higher revenue and earnings than Northrim BanCorp.

Volatility and Risk

Kearny Financial has a beta of 0.57, meaning that its stock price is 43% less volatile than the S&P 500. Comparatively, Northrim BanCorp has a beta of 0.78, meaning that its stock price is 22% less volatile than the S&P 500.

Dividends

Kearny Financial pays an annual dividend of $0.16 per share and has a dividend yield of 1.2%. Northrim BanCorp pays an annual dividend of $0.96 per share and has a dividend yield of 2.4%. Northrim BanCorp pays out 47.1% of its earnings in the form of a dividend.

Institutional & Insider Ownership

51.2% of Kearny Financial shares are held by institutional investors. Comparatively, 70.5% of Northrim BanCorp shares are held by institutional investors. 3.8% of Kearny Financial shares are held by insiders. Comparatively, 2.9% of Northrim BanCorp shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Kearny Financial beats Northrim BanCorp on 7 of the 13 factors compared between the two stocks.

Kearny Financial Company Profile

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 comprising one-to-four family mortgage loans; commercial mortgages, including loans secured by multi-family, mixed-use, and nonresidential properties; secured and unsecured business loans; consumer loans, such as home equity loans, home equity lines of credit, account loans, overdraft lines of credit, vehicle loans, personal loans, and loans secured by savings accounts and certificates of deposit; and construction loans to builders/developers and individual homeowners. In addition, it sells insurance products to its customers and the general public through a third party networking arrangement. As of August 16, 2017, the company operated 42 branches located in northern and central New Jersey, and Brooklyn and Staten Island, New York. Kearny Financial Corp. was founded in 1884 and is headquartered in Fairfield, New Jersey.

Northrim BanCorp Company Profile

Northrim BanCorp, Inc. operates as the bank holding company for Northrim Bank that provides commercial banking products and services to businesses and professionals in Alaska. The company operates in two segments, Community Banking and Home Mortgage Lending. It offers various deposit products, including noninterest-bearing checking accounts and interest-bearing time deposits, checking accounts, and savings accounts, as well as money market deposit accounts, certificates of deposit, and courier noncash deposits. The company also provides family residential mortgages; commercial loans, such as secured and unsecured loans for working capital and expansion; commercial real estate loans; construction loans for commercial real estate projects, and land development and residential subdivision construction loans; and consumer loans comprising loans for automobiles, recreational vehicles, boats, and other consumer purchases, as well as home equity and commercial credit lines, and factoring services. In addition, it offers other services comprising consumer online banking, mobile app and mobile deposit, mobile Web and text banking, business online banking, personal finance, online documents, consumer and business debit cards, personalized checks at account opening, telebanking, automated teller, overdraft protection from a savings account, commercial drive-up banking, automatic transfers and payments, wire transfers, direct payroll deposit, electronic tax payments, automated clearing house origination and receipt, remote deposit capture, merchant, and cash management services, as well as annuity products, and long term investment portfolios. As of January 29, 2018, the company operated 14 branches in Anchorage, the Matanuska Valley, Juneau, Fairbanks, Ketchikan, and Sitka. Northrim BanCorp, Inc. was founded in 1990 and is headquartered in Anchorage, Alaska.