Contrasting Oritani Financial (NASDAQ:ORIT) and Sierra Bancorp (NASDAQ:BSRR)

Sierra Bancorp (NASDAQ:BSRR) and Oritani Financial (NASDAQ:ORIT) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, analyst recommendations, risk, dividends, earnings, institutional ownership and profitability.

Dividends

Sierra Bancorp pays an annual dividend of $0.76 per share and has a dividend yield of 2.8%. Oritani Financial pays an annual dividend of $0.72 per share and has a dividend yield of 3.9%. Sierra Bancorp pays out 39.6% of its earnings in the form of a dividend. Oritani Financial pays out 61.0% 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.

Profitability

This table compares Sierra Bancorp and Oritani Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sierra Bancorp 25.98% 11.95% 1.35%
Oritani Financial 31.46% 9.63% 1.26%

Risk & Volatility

Sierra Bancorp has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500. Comparatively, Oritani Financial has a beta of 0.69, indicating that its stock price is 31% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for Sierra Bancorp and Oritani Financial, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sierra Bancorp 0 0 2 0 3.00
Oritani Financial 0 0 1 0 3.00

Sierra Bancorp currently has a consensus price target of $28.00, indicating a potential upside of 4.24%. Oritani Financial has a consensus price target of $19.00, indicating a potential upside of 2.15%. Given Sierra Bancorp’s higher probable upside, analysts clearly believe Sierra Bancorp is more favorable than Oritani Financial.

Institutional and Insider Ownership

54.5% of Sierra Bancorp shares are owned by institutional investors. Comparatively, 68.3% of Oritani Financial shares are owned by institutional investors. 10.3% of Sierra Bancorp shares are owned by insiders. Comparatively, 10.2% of Oritani Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Sierra Bancorp and Oritani Financial’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sierra Bancorp $123.20 million 3.33 $29.68 million $1.92 13.99
Oritani Financial $160.51 million 5.23 $52.06 million $1.18 15.76

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

Summary

Sierra Bancorp beats Oritani Financial on 8 of the 15 factors compared between the two stocks.

About Sierra Bancorp

Sierra Bancorp operates as the bank holding company for Bank of the Sierra that provides retail and commercial banking services to individuals and businesses in California. The company accepts various deposit products, such as checking accounts, savings accounts, money market demand accounts, time deposits, retirement accounts, and sweep accounts. Its loan products include real estate, commercial, mortgage warehouse, agricultural, industrial, and consumer loans. The company also offers automated teller machines; electronic point-of-sale payment alternatives; online and automated telephone banking services; and remote deposit capture and automated payroll services for business customers. As of December 31, 2018, it operated 40 full service branches, an online branch, an agricultural credit center, and an SBA lending unit. Sierra Bancorp was founded in 1977 and is headquartered in Porterville, California.

About Oritani Financial

Oritani Financial Corp. operates as a savings and loan holding company for Oritani Bank that provides various banking services for individual and corporate customers. The company accepts a range of deposit products, such as non-interest and interest-bearing demand and NOW checking accounts, money market deposit accounts, savings accounts, retirement accounts, and time deposits. Its loan products include residential commercial real estate loans comprising mortgage loans secured by apartment buildings; commercial real estate loans, consisting of mortgage loans secured by retail anchor shopping centers, commercial offices, retail space, warehouses, and mixed-use buildings; residential real estate loans, such as one to four family residential real property and home equity loans; and second mortgage and equity loans, and home equity lines of credit, as well as construction loans. The company also invests in securities and real estate properties. As of June 30, 2018, it operated 25 full service branches in Bergen, Hudson, Essex, and Passaic counties, New Jersey; and lending offices in New York City and Cherry Hill, New Jersey. Oritani Financial Corp. was founded in 1911 and is headquartered in Washington Township, New Jersey.

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