Analyzing Valley National Bancorp (NASDAQ:VLY) & Hanover Bancorp (NASDAQ:HNVR)

Hanover Bancorp (NASDAQ:HNVR) and Valley National Bancorp (NASDAQ:VLY) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, dividends, earnings, risk, valuation, analyst recommendations and institutional ownership.

Valuation and Earnings

This table compares Hanover Bancorp and Valley National Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hanover Bancorp	$148.36 million	1.11	$12.35 million	$1.53	14.93
Valley National Bancorp	$3.58 billion	1.65	$380.27 million	$0.78	13.58

Valley National Bancorp has higher revenue and earnings than Hanover Bancorp. Valley National 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.

Dividends

Hanover Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 1.8%. Valley National Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 4.2%. Hanover Bancorp pays out 26.1% of its earnings in the form of a dividend. Valley National Bancorp pays out 56.4% 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, 61.0% of Valley National Bancorp shares are owned by institutional investors. 23.9% of Hanover Bancorp shares are owned by insiders. Comparatively, 1.4% of Valley National Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Hanover Bancorp	7.73%	7.40%	0.61%
Valley National Bancorp	12.87%	5.89%	0.66%

Analyst Recommendations

This is a summary of current ratings and price targets for Hanover Bancorp and Valley National Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hanover Bancorp	0	3	1	0	2.25
Valley National Bancorp	0	2	12	0	2.86

Hanover Bancorp presently has a consensus price target of $23.83, indicating a potential upside of 4.35%. Valley National Bancorp has a consensus price target of $12.39, indicating a potential upside of 17.02%. Given Valley National Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Valley National Bancorp is more favorable than Hanover Bancorp.

Risk & Volatility

Hanover Bancorp has a beta of 0.07, indicating that its stock price is 93% less volatile than the S&P 500. Comparatively, Valley National Bancorp has a beta of 1.13, indicating that its stock price is 13% more volatile than the S&P 500.

Summary

Valley National Bancorp beats Hanover Bancorp on 11 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 Valley National Bancorp

Valley National Bancorp operates as the holding company for Valley National Bank that provides various commercial, private banking, retail, insurance, and wealth management financial services products. It operates through Consumer Banking, Commercial Banking, and Treasury and Corporate other segments. The company offers non-interest bearing, savings, NOW, money market, and time deposit accounts; commercial and industrial, commercial real estate, residential mortgage, and automobile loans; loans secured by the cash surrender value of life insurance; home equity loans and lines of credit; automobile financing; and secured and unsecured other consumer loans. It also invests in various securities and interest-bearing deposits with other banks; and provides international banking services, such as standby and documentary letters of credit, and related products, as well as foreign exchange transactions, documentary collections, and foreign wire transfers services. In addition, the company offers investment services for individuals and small to medium sized businesses; and trusts investment strategies designed for various investment profiles and objectives. Further, it provides trust services, such as living and testamentary trusts, investment management, custodial and escrow services, and estate administration to individuals; tax credit advisory services; brokerage services; property and casualty, life, health, and title insurance agency services; and health care equipment lending and other commercial equipment leasing services, as well as owns real estate related investments. Additionally, the company offers online, mobile, and telephone banking services; receivable, payment, and security solution, merchant, payroll processing, and liquidity services; credit cards; and drive-in and night deposit, automated teller machine, remote deposit capture, and safe deposit facility services. Valley National Bancorp was founded in 1927 and is headquartered in Morristown, New Jersey.