Reviewing Byline Bancorp (NYSE:BY) and Ottawa Bancorp (OTCMKTS:OTTW)

Ottawa Bancorp (OTCMKTS:OTTW) and Byline Bancorp (NYSE:BY) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, dividends, profitability, earnings, valuation, institutional ownership and analyst recommendations.

Earnings and Valuation

This table compares Ottawa Bancorp and Byline Bancorp”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ottawa Bancorp	$17.43 million	1.96	$780,000.00	$0.79	18.86
Byline Bancorp	$624.78 million	2.25	$120.76 million	$2.81	10.94

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

Risk & Volatility

Ottawa Bancorp has a beta of 0.06, suggesting that its stock price is 94% less volatile than the S&P 500. Comparatively, Byline Bancorp has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500.

Dividends

Ottawa Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 3.0%. Byline Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 1.3%. Ottawa Bancorp pays out 55.7% of its earnings in the form of a dividend. Byline Bancorp pays out 14.2% 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. Byline Bancorp has increased its dividend for 1 consecutive years.

Institutional & Insider Ownership

67.7% of Byline Bancorp shares are owned by institutional investors. 7.8% of Ottawa Bancorp shares are owned by insiders. Comparatively, 28.8% of Byline Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings and price targets for Ottawa Bancorp and Byline Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ottawa Bancorp	0	0	0	0	0.00
Byline Bancorp	0	2	3	0	2.60

Byline Bancorp has a consensus price target of $33.25, indicating a potential upside of 8.18%. Given Byline Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe Byline Bancorp is more favorable than Ottawa Bancorp.

Profitability

This table compares Ottawa Bancorp and Byline Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ottawa Bancorp	10.21%	4.70%	0.53%
Byline Bancorp	20.01%	11.26%	1.36%

Summary

Byline Bancorp beats Ottawa Bancorp on 15 of the 17 factors compared between the two stocks.

About Ottawa Bancorp

Ottawa Bancorp, Inc. operates as the bank holding company for OSB Community Bank, a savings bank that provides various financial services to individual and corporate customers in Illinois. The company's deposit products include saving, checking, money market, and interest-bearing accounts, as well as certificate of deposit. Its loan portfolio comprises commercial, non-residential real estate, one-to-four family residential, multi-family residential, consumer direct, and purchased auto loans; business and construction loans; motor vehicle, home improvement, share, and personal unsecured loans, as well as home equity and small personal credit lines; mortgage loans; and student loans. The company also provides cash management solutions, such as remote deposit capture, automated clearing house/payroll direct deposit, and merchant services, as well as commercial leasing services. In addition, it offers notary, lamination, night depository, document faxing, money gift envelopes, safe deposit boxes, and coin counting, as well as debit and credit cards, and digital banking services. The company was formerly known as Ottawa Savings Bancorp, Inc. and changed its name to Ottawa Bancorp, Inc. in October 2016. Ottawa Bancorp, Inc. was founded in 1871 and is based in Ottawa, Illinois.

About Byline Bancorp

Byline Bancorp, Inc. operates as the bank holding company for Byline Bank that provides various banking products and services for small and medium sized businesses, commercial real estate and financial sponsors, and consumers in the United States. It offers various retail deposit products, including non-interest-bearing accounts, money market demand accounts, savings accounts, interest-bearing checking accounts, and time deposits; ATM and debit cards; and online, mobile, and text banking services, as well as commercial deposits. The company also provides term loans, revolving lines of credit, and construction financing services; senior secured financing solutions to private equity backed lower middle market companies; small business administration and united states department of agriculture loans; and treasury management products and services. In addition, it offers financing solutions for equipment vendors and their end users; syndication services; and investment, trust, and wealth management services that include fiduciary and executor services, financial planning solutions, investment advisory services, and private banking services for foundations and endowments, and high net worth individuals. The company was formerly known as Metropolitan Bank Group, Inc. and changed its name to Byline Bancorp, Inc. in 2015. Byline Bancorp, Inc. was founded in 1914 and is headquartered in Chicago, Illinois.