Financial Contrast: OFG Bancorp (NYSE:OFG) versus Eastern Bankshares (NASDAQ:EBC)

Eastern Bankshares (NASDAQ:EBC) and OFG Bancorp (NYSE:OFG) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, profitability, earnings, analyst recommendations, valuation and institutional ownership.

Volatility & Risk

Eastern Bankshares has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500. Comparatively, OFG Bancorp has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Eastern Bankshares and OFG Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eastern Bankshares	0	3	4	1	2.75
OFG Bancorp	0	4	3	0	2.43

Eastern Bankshares presently has a consensus price target of $22.75, suggesting a potential upside of 8.08%. OFG Bancorp has a consensus price target of $45.83, suggesting a potential upside of 7.66%. Given Eastern Bankshares’ stronger consensus rating and higher possible upside, equities analysts plainly believe Eastern Bankshares is more favorable than OFG Bancorp.

Insider & Institutional Ownership

71.7% of Eastern Bankshares shares are owned by institutional investors. Comparatively, 92.7% of OFG Bancorp shares are owned by institutional investors. 1.3% of Eastern Bankshares shares are owned by insiders. Comparatively, 1.2% of OFG Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

Eastern Bankshares pays an annual dividend of $0.52 per share and has a dividend yield of 2.5%. OFG Bancorp pays an annual dividend of $1.40 per share and has a dividend yield of 3.3%. Eastern Bankshares pays out 126.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. OFG Bancorp pays out 30.6% of its earnings in the form of a dividend. Eastern Bankshares has raised its dividend for 5 consecutive years and OFG Bancorp has raised its dividend for 5 consecutive years. OFG Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Eastern Bankshares and OFG Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eastern Bankshares	$1.33 billion	3.72	$88.22 million	$0.41	51.34
OFG Bancorp	$902.28 million	2.00	$205.10 million	$4.58	9.30

OFG Bancorp has lower revenue, but higher earnings than Eastern Bankshares. OFG Bancorp is trading at a lower price-to-earnings ratio than Eastern Bankshares, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Eastern Bankshares and OFG Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eastern Bankshares	8.32%	8.25%	1.19%
OFG Bancorp	22.72%	15.21%	1.69%

Summary

Eastern Bankshares beats OFG Bancorp on 9 of the 17 factors compared between the two stocks.

About Eastern Bankshares

Eastern Bankshares, Inc. operates as the bank holding company for Eastern Bank that provides banking products and services primarily to retail, commercial, and small business customers. The company provides deposit accounts, interest checking accounts, money market accounts, savings accounts, and time certificates of deposit accounts. It also offers commercial and industrial, commercial real estate and construction, small business, residential real estate, and home equity loans; lines of credit; and other consumer loans comprising unsecured personal lines of credit, overdraft protection, automobile loans, home improvement loans, airplane loans, and other personal loans. In addition, the company provides trust, financial planning and portfolio management, automated lock box collection, cash management, and account reconciliation services; personal, business, and employee benefits insurance products. Eastern Bankshares, Inc. was founded in 1818 and is headquartered in Boston, Massachusetts.

About OFG Bancorp

OFG Bancorp, a financial holding company, provides a range of banking and financial services. It operates through three segments: Banking, Wealth Management, and Treasury. The company offers checking and savings accounts, and individual retirement accounts; certificate of deposits, as well as time deposit products; commercial, consumer, auto leasing, and mortgage lending services; credit cards; cash management; financial planning and insurance services; and corporate and individual trust, and retirement services. In addition, it provides securities brokerage and investment advisory services, including various investment alternatives, such as tax-advantaged fixed income securities, mutual funds, stocks, and bonds to retail and institutional clients; and separately-managed accounts and mutual fund asset allocation programs. Further, the company engages in the insurance agency and reinsurance businesses; administration and servicing of retirement plans; and various treasury-related functions with an investment portfolio consisting of mortgage-backed securities, obligations of U.S. government sponsored agencies, and U.S. Treasury securities and money market instruments. Additionally, it offers money management and investment banking services; and engages in the asset/liability management activities, such as purchases and sales of investment securities, interest rate risk management, derivatives, and borrowings. The company provides investment brokerage, transactional, international trade financing, residential mortgage, and consumer finance services. OFG Bancorp was founded in 1964 and is headquartered in San Juan, Puerto Rico.