Critical Analysis: Great Southern Bancorp (NASDAQ:GSBC) vs. Broadway Financial (NASDAQ:BYFC)

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

Analyst Recommendations

This is a breakdown of recent ratings for Broadway Financial and Great Southern Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Broadway Financial	1	0	0	0	1.00
Great Southern Bancorp	0	3	1	0	2.25

Great Southern Bancorp has a consensus target price of $60.50, suggesting a potential downside of 5.68%. Given Great Southern Bancorp’s stronger consensus rating and higher probable upside, analysts clearly believe Great Southern Bancorp is more favorable than Broadway Financial.

Insider and Institutional Ownership

12.1% of Broadway Financial shares are held by institutional investors. Comparatively, 41.7% of Great Southern Bancorp shares are held by institutional investors. 4.1% of Broadway Financial shares are held by company insiders. Comparatively, 27.9% of Great Southern Bancorp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Risk & Volatility

Broadway Financial has a beta of 0.71, suggesting that its share price is 29% less volatile than the S&P 500. Comparatively, Great Southern Bancorp has a beta of 0.52, suggesting that its share price is 48% less volatile than the S&P 500.

Profitability

This table compares Broadway Financial and Great Southern Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Broadway Financial	3.18%	1.46%	0.15%
Great Southern Bancorp	20.70%	11.40%	1.21%

Valuation and Earnings

This table compares Broadway Financial and Great Southern Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Broadway Financial	$63.76 million	1.19	$1.93 million	($0.13)	-63.54
Great Southern Bancorp	$229.29 million	3.13	$70.97 million	$6.20	10.35

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

Summary

Great Southern Bancorp beats Broadway Financial on 13 of the 14 factors compared between the two stocks.

About Broadway Financial

Broadway Financial Corporation operates as the holding company for City First Bank, National Association that provides various banking products and services in the United States. It accepts various deposit accounts, including savings accounts, checking accounts, interest checking accounts, money market accounts, and fixed-term certificates of deposit. The company also offers mortgage loans, which are secured by multi-family residential properties; single family residential properties; and commercial real estate, including charter schools, community facilities, and churches, as well as commercial business, construction, and consumer loans. In addition, it invests in securities issued by federal government agencies, residential mortgage-backed securities, and other investments. The company was founded in 1946 and is headquartered in Los Angeles, California.

About Great Southern Bancorp

Great Southern Bancorp, Inc. operates as a bank holding company for Great Southern Bank that provides a range of financial services in the United States. Its deposit products include regular savings accounts, checking accounts, money market accounts, fixed interest rate certificates with varying maturities, certificates of deposit, brokered certificates, and individual retirement accounts. The company's loan portfolio comprises residential and commercial real estate loans, commercial business loans, construction loans, home improvement loans, and unsecured consumer loans, as well as secured consumer loans, such as automobile loans, boat loans, home equity loans, and loans secured by savings deposits. It also provides insurance and merchant banking services. The company was founded in 1923 and is headquartered in Springfield, Missouri.