LegacyTexas Financial Group (LTXB) & MSB Financial (MSBF) Critical Contrast

LegacyTexas Financial Group (NASDAQ:LTXB) and MSB Financial (NASDAQ:MSBF) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitability.

Institutional & Insider Ownership

87.1% of LegacyTexas Financial Group shares are held by institutional investors. Comparatively, 21.0% of MSB Financial shares are held by institutional investors. 3.2% of LegacyTexas Financial Group shares are held by company insiders. Comparatively, 18.0% of MSB Financial shares are held by company 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.

Analyst Ratings

This is a breakdown of recent recommendations for LegacyTexas Financial Group and MSB Financial, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LegacyTexas Financial Group 0 3 6 0 2.67
MSB Financial 0 0 0 0 N/A

LegacyTexas Financial Group currently has a consensus target price of $48.64, indicating a potential upside of 20.49%. Given LegacyTexas Financial Group’s higher possible upside, equities analysts clearly believe LegacyTexas Financial Group is more favorable than MSB Financial.

Dividends

LegacyTexas Financial Group pays an annual dividend of $0.88 per share and has a dividend yield of 2.2%. MSB Financial does not pay a dividend. LegacyTexas Financial Group pays out 40.4% of its earnings in the form of a dividend. LegacyTexas Financial Group has increased its dividend for 2 consecutive years.

Volatility & Risk

LegacyTexas Financial Group has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500. Comparatively, MSB Financial has a beta of 0.27, meaning that its share price is 73% less volatile than the S&P 500.

Valuation & Earnings

This table compares LegacyTexas Financial Group and MSB Financial’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LegacyTexas Financial Group $410.44 million 4.77 $89.49 million $2.18 18.52
MSB Financial $20.30 million 5.12 $2.72 million N/A N/A

LegacyTexas Financial Group has higher revenue and earnings than MSB Financial.

Profitability

This table compares LegacyTexas Financial Group and MSB Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LegacyTexas Financial Group 24.77% 12.44% 1.37%
MSB Financial 16.37% 6.44% 0.78%

Summary

LegacyTexas Financial Group beats MSB Financial on 11 of the 15 factors compared between the two stocks.

LegacyTexas Financial Group Company Profile

LegacyTexas Financial Group, Inc. operates as the holding company for LegacyTexas Bank that provides various banking products and services in the United States. Its deposit products include interest-bearing and non-interest-bearing demand accounts, savings, money market, certificates of deposit, and individual retirement accounts. The company's lending products comprise commercial and consumer real estate loans; secured and unsecured commercial and industrial loans; permanent loans secured by first and second mortgages on one- to four-family residences; construction and land loans; and secured and unsecured consumer loans, including new and used automobile loans, recreational vehicle loans, and loans secured by savings deposits. It also provides insurance and title services. As of January 23, 2018, the company had 3 administrative offices, 44 full-service branches, and 1 commercial loan production office located in Houston, Texas, as well as a Warehouse Purchase Program office located in Littleton, Colorado. The company was formerly known as ViewPoint Financial Group, Inc. and changed its name to LegacyTexas Financial Group, Inc. in January 2015. LegacyTexas Financial Group, Inc. is headquartered in Plano, Texas.

MSB Financial Company Profile

MSB Financial Corp. operates as the bank holding company for Millington Bank that provides various banking products and services in New Jersey. The company offers deposit products, including checking accounts; savings accounts, such as regular passbook, statement, money market, and club accounts, as well as six-level tiered savings accounts; certificates of deposit; and fixed or variable rate individual retirement accounts. Its loan portfolio comprises one-to four-family real estate mortgage loans, commercial and multi-family real estate mortgage loans, construction loans, commercial and industrial loans, and home equity loans and lines of credit, as well as consumer loans consisting of new and used automobile loans, secured and unsecured personal loans, account loans, and overdraft lines of credit. The company was founded in 1911 and is based in Millington, New Jersey.

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