HarborOne Bancorp (NASDAQ:HONE) and OP Bancorp (NASDAQ:OPBK) Critical Survey

HarborOne Bancorp (NASDAQ:HONE) and OP Bancorp (NASDAQ:OPBK) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, risk, dividends and analyst recommendations.

Institutional and Insider Ownership

65.0% of HarborOne Bancorp shares are held by institutional investors. Comparatively, 53.6% of OP Bancorp shares are held by institutional investors. 4.9% of HarborOne Bancorp shares are held by company insiders. Comparatively, 21.3% of OP Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current recommendations for HarborOne Bancorp and OP Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HarborOne Bancorp	0	1	0	0	2.00
OP Bancorp	0	1	0	0	2.00

HarborOne Bancorp presently has a consensus price target of $13.00, indicating a potential upside of 10.08%. OP Bancorp has a consensus price target of $18.00, indicating a potential upside of 29.31%. Given OP Bancorp’s higher probable upside, analysts clearly believe OP Bancorp is more favorable than HarborOne Bancorp.

Profitability

This table compares HarborOne Bancorp and OP Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HarborOne Bancorp	8.61%	4.63%	0.46%
OP Bancorp	13.68%	10.64%	0.91%

Earnings & Valuation

This table compares HarborOne Bancorp and OP Bancorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HarborOne Bancorp	$318.33 million	1.63	$27.41 million	$0.66	17.89
OP Bancorp	$154.05 million	1.34	$21.07 million	$1.39	10.01

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

Dividends

HarborOne Bancorp pays an annual dividend of $0.32 per share and has a dividend yield of 2.7%. OP Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 3.4%. HarborOne Bancorp pays out 48.5% of its earnings in the form of a dividend. OP Bancorp pays out 34.5% 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. OP Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

HarborOne Bancorp has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500. Comparatively, OP Bancorp has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500.

Summary

OP Bancorp beats HarborOne Bancorp on 8 of the 14 factors compared between the two stocks.

About HarborOne Bancorp

HarborOne Bancorp, Inc. operates as the holding company for HarborOne Bank that provides financial services to individuals, families, small and mid-size businesses, and municipalities. The company operates in two segments, HarborOne Bank and HarborOne Mortgage. Its primary deposit products include checking, money market, savings, and term certificate of deposit accounts; and primary lending products comprise commercial real estate, commercial, residential mortgages, home equity, and consumer loans. The company also originates, sells, and services residential mortgage loans. In addition, it provides various educational services, such as free digital content, webinars, and recordings for small business and personal financial education under the HarborOne U name. The company operates through a network of full-service branches located in Massachusetts and Rhode Island, as well as commercial lending offices in each of Boston, Massachusetts, and Providence, Rhode Island, as well as administrative offices in Brockton, Massachusetts, as well as ATM locations in Massachusetts. HarborOne Bancorp, Inc. was founded in 1917 and is headquartered in Brockton, Massachusetts.

About OP Bancorp

OP Bancorp operates as the bank holding company for Open Bank that provides banking products and services in California. It offers demand, checking, savings, money market, and time deposit accounts, as well as certificates of deposit. The company also provides commercial real estate, small business administration, commercial and industrial business, single-family residential, term, consumer, and home mortgage loans; trade financing products; and letters of credit, and SWIFT and export advice. In addition, it offers debit and credit card, online transfer and bill payment, electronic delivery of customer statements, and mobile banking solutions for iPhone and Android phones, including remote check deposit with mobile bill pay; direct deposits, cashier's checks, person to person payments, wire transfers, and automated clearing house (ACH) services; and cash management services, including balance reporting, transfers between accounts, wire transfer initiation, ACH origination, and stop payment services, as well as remote deposit capture, positive pay, zero balance accounts, and sweep accounts. The company operates full branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Gardena, Buena Park, and Santa Clara in California; and Carrollton, Texas; and operates loan production offices in Pleasanton, California; Atlanta, Georgia; Aurora, Colorado; and Lynnwood in Washington. The company was founded in 2005 and is headquartered in Los Angeles, California.