Critical Contrast: Eastern Bankshares (NASDAQ:EBC) versus Wayne Savings Bancshares (OTCMKTS:WAYN)

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

Profitability

This table compares Wayne Savings Bancshares and Eastern Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Wayne Savings Bancshares	17.74%	16.26%	1.03%
Eastern Bankshares	48.38%	5.06%	0.68%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Wayne Savings Bancshares and Eastern Bankshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wayne Savings Bancshares	0	0	0	0	N/A
Eastern Bankshares	0	1	1	0	2.50

Eastern Bankshares has a consensus price target of $18.75, indicating a potential upside of 8.51%. Given Eastern Bankshares’ higher probable upside, analysts plainly believe Eastern Bankshares is more favorable than Wayne Savings Bancshares.

Insider and Institutional Ownership

12.1% of Wayne Savings Bancshares shares are owned by institutional investors. Comparatively, 71.7% of Eastern Bankshares shares are owned by institutional investors. 3.2% of Wayne Savings Bancshares shares are owned by company insiders. Comparatively, 1.2% of Eastern Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Wayne Savings Bancshares and Eastern Bankshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wayne Savings Bancshares	$38.11 million	1.40	$7.83 million	$3.21	7.56
Eastern Bankshares	$623.53 million	4.89	$232.18 million	$2.85	6.06

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

Risk & Volatility

Wayne Savings Bancshares has a beta of 0.28, meaning that its stock price is 72% less volatile than the S&P 500. Comparatively, Eastern Bankshares has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500.

Dividends

Wayne Savings Bancshares pays an annual dividend of $0.92 per share and has a dividend yield of 3.8%. Eastern Bankshares pays an annual dividend of $0.44 per share and has a dividend yield of 2.5%. Wayne Savings Bancshares pays out 28.7% of its earnings in the form of a dividend. Eastern Bankshares pays out 15.4% 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.

Summary

Eastern Bankshares beats Wayne Savings Bancshares on 9 of the 15 factors compared between the two stocks.

About Wayne Savings Bancshares

Wayne Savings Bancshares, Inc. operates as the holding company for Wayne Savings Community Bank that provides personal and business banking products and services to individuals, businesses, and other organizations. The company offers checking, savings, money market, and term certificate accounts, as well as certificates of deposit. It also provides residential mortgage, commercial, installment, residential and nonresidential real estate, commercial real estate, residential construction, multi-family real estate, land, commercial business, consumer, home, home equity, auto, recreational vehicle, personal, furniture and appliance, agriculture, and term loans, as well as lines of credit, government guaranteed programs, and standby letters of credit. In addition, the company offers retirement planning, investment advisory, insurance, and wealth management and trust services. Further, it provides overdraft protection, re-order check, remote deposit capture, merchant, sweep, online and mobile banking, and bill pay services, as well as debit, credit, and gift cards. The company was founded in 1899 and is based in Wooster, Ohio.

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.