Parke Bancorp (NASDAQ:PKBK) & NB Bancorp (NASDAQ:NBBK) Critical Review

NB Bancorp (NASDAQ:NBBK) and Parke Bancorp (NASDAQ:PKBK) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, institutional ownership, risk, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of recent ratings and target prices for NB Bancorp and Parke Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NB Bancorp	0	2	1	1	2.75
Parke Bancorp	0	0	1	0	3.00

NB Bancorp currently has a consensus price target of $23.00, suggesting a potential upside of 16.51%. Given NB Bancorp’s higher probable upside, analysts plainly believe NB Bancorp is more favorable than Parke Bancorp.

Insider & Institutional Ownership

49.7% of Parke Bancorp shares are held by institutional investors. 1.9% of NB Bancorp shares are held by insiders. Comparatively, 15.3% of Parke Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

NB Bancorp pays an annual dividend of $0.28 per share and has a dividend yield of 1.4%. Parke Bancorp pays an annual dividend of $0.72 per share and has a dividend yield of 2.8%. NB Bancorp pays out 18.1% of its earnings in the form of a dividend. Parke Bancorp pays out 25.4% 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.

Profitability

This table compares NB Bancorp and Parke Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NB Bancorp	17.59%	7.79%	1.10%
Parke Bancorp	23.95%	11.07%	1.58%

Valuation and Earnings

This table compares NB Bancorp and Parke Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NB Bancorp	$304.05 million	2.59	$42.15 million	$1.55	12.74
Parke Bancorp	$129.41 million	2.28	$27.51 million	$2.84	8.96

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

Volatility & Risk

NB Bancorp has a beta of 0.32, indicating that its stock price is 68% less volatile than the S&P 500. Comparatively, Parke Bancorp has a beta of 0.51, indicating that its stock price is 49% less volatile than the S&P 500.

Summary

Parke Bancorp beats NB Bancorp on 9 of the 16 factors compared between the two stocks.

About NB Bancorp

NB Bancorp, Inc. focuses on operating as a bank holding company for Needham Bank that provides various banking products and services in Greater Boston metropolitan area and surrounding communities in Massachusetts, eastern Connecticut, southern New Hampshire, and Rhode Island. The company offers various deposits, including certificate of deposit, individual retirement, money market, savings, NOW, demand deposit, and interest-bearing and noninterest-bearing checking accounts; and commercial real estate and multifamily, one- to four-family residential real estate, construction and land development, commercial and industrial, and consumer loans, as well as home equity loans and lines of credit. It also invests in securities consisting of U.S. treasury and federal agency securities, government-sponsored residential mortgage-backed securities, municipal bonds, and corporate bonds. The company was founded in 1892 and is based in Needham, Massachusetts.

About Parke Bancorp

Parke Bancorp, Inc. operates as the bank holding company for Parke Bank that provides personal and business financial services to individuals and small to mid-sized businesses. The company offers various deposit products, including checking, savings, time, money market, and individual retirement accounts, as well as certificates of deposit. Its loan portfolio comprises commercial and industrial, construction, commercial and residential real estate mortgage, and consumer loans. In addition, the company provides debit cards, internet banking, and online bill payment services. Parke Bancorp, Inc. was founded in 1999 and is headquartered in Washington Township, New Jersey.