Head to Head Review: Amerant Bancorp (NASDAQ:AMTB) & OceanFirst Financial (NASDAQ:OCFC)

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

Institutional and Insider Ownership

42.1% of Amerant Bancorp shares are held by institutional investors. Comparatively, 71.0% of OceanFirst Financial shares are held by institutional investors. 13.5% of Amerant Bancorp shares are held by company insiders. Comparatively, 5.0% of OceanFirst Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

Amerant Bancorp pays an annual dividend of $0.36 per share and has a dividend yield of 1.8%. OceanFirst Financial pays an annual dividend of $0.80 per share and has a dividend yield of 4.5%. Amerant Bancorp pays out 52.9% of its earnings in the form of a dividend. OceanFirst Financial pays out 46.8% 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. OceanFirst Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

Amerant Bancorp has a beta of 1, suggesting that its stock price has a similar volatility profile to the S&P 500.Comparatively, OceanFirst Financial has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500.

Profitability

This table compares Amerant Bancorp and OceanFirst Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Amerant Bancorp	3.15%	7.78%	0.59%
OceanFirst Financial	14.78%	5.85%	0.72%

Valuation & Earnings

This table compares Amerant Bancorp and OceanFirst Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Amerant Bancorp	$334.26 million	2.05	$32.49 million	$0.68	29.85
OceanFirst Financial	$388.93 million	2.70	$104.03 million	$1.71	10.46

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

Analyst Ratings

This is a breakdown of current recommendations and price targets for Amerant Bancorp and OceanFirst Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Amerant Bancorp	0	2	3	0	2.60
OceanFirst Financial	0	3	2	0	2.40

Amerant Bancorp currently has a consensus target price of $25.50, suggesting a potential upside of 25.62%. OceanFirst Financial has a consensus target price of $18.90, suggesting a potential upside of 5.70%. Given Amerant Bancorp’s stronger consensus rating and higher probable upside, research analysts clearly believe Amerant Bancorp is more favorable than OceanFirst Financial.

Summary

OceanFirst Financial beats Amerant Bancorp on 10 of the 16 factors compared between the two stocks.

About Amerant Bancorp

Amerant Bancorp Inc. operates as the bank holding company for Amerant Bank, N.A. that provides banking products and services to individuals and businesses in the United States and internationally. It offers checking, savings, business, and money market accounts; cash management services; and certificates of deposits. The company also provides variable and fixed rate commercial real estate loans; owner-occupied; single-family residential; commercial; and consumer loans and overdrafts, such as automobile, personal, or loans secured by cash or securities and revolving credit card agreements. In addition, it offers trust and estate planning products and services to high-net-worth customers, brokerage and investment advisory services in global capital markets, and wealth management and fiduciary services. Further, the company provides debit and credit cards, night depositories, direct deposits, cashier's checks, safe deposit boxes, letters of credit, and treasury management services, including wire transfer, remote deposit capture, and automated clearinghouse services; derivative instruments; and online and mobile banking, account balances, statements and other documents, online transfers and bill payment, and electronic delivery of customer statements services, as well as automated teller machines, and banking by mobile devices, telephone, and mail. It operates banking centers in Florida and Texas. The company was formerly known as Mercantil Bank Holding Corporation and changed its name to Amerant Bancorp Inc. in June 2019. Amerant Bancorp Inc. was founded in 1979 and is headquartered in Coral Gables, Florida.

About OceanFirst Financial

OceanFirst Financial Corp. operates as the bank holding company for OceanFirst Bank N.A. that provides community banking services to retail and commercial customers. It accepts money market accounts, savings accounts, interest-bearing checking accounts, non-interest-bearing accounts, and time deposits, that includes brokered deposits to retail, government, and business customers. The company also offers commercial real estate, multi-family, land loans, construction, and commercial and industrial loans; fixed-rate and adjustable-rate mortgage loans that are secured by one-to-four family residences; and consumer loans, such as home equity loans and lines of credit, student loans, overdraft line of credit, loans on savings accounts, and other consumer loans. In addition, it invests in mortgage-backed securities, securities issued by the U.S. Government and agencies, corporate securities, and other investments. Further, the company offers bankcard, trust and asset management services; and bank owned life insurance products. The company was founded in 1902 and is based in Red Bank, New Jersey.