Old Point Financial (NASDAQ:OPOF) versus OceanFirst Financial (NASDAQ:OCFC) Critical Review

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

Earnings & Valuation

This table compares Old Point Financial and OceanFirst Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Old Point Financial	$61.63 million	2.48	$9.51 million	$1.88	16.01
OceanFirst Financial	$379.81 million	2.73	$100.07 million	$1.65	10.74

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

Volatility and Risk

Old Point Financial has a beta of 0.26, indicating that its share price is 74% less volatile than the S&P 500. Comparatively, OceanFirst Financial has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for Old Point Financial and OceanFirst Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Old Point Financial	0	0	0	0	0.00
OceanFirst Financial	0	4	1	1	2.50

OceanFirst Financial has a consensus target price of $20.83, indicating a potential upside of 17.54%. Given OceanFirst Financial’s stronger consensus rating and higher probable upside, analysts plainly believe OceanFirst Financial is more favorable than Old Point Financial.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Old Point Financial	11.08%	8.56%	0.66%
OceanFirst Financial	14.45%	5.75%	0.72%

Insider & Institutional Ownership

33.4% of Old Point Financial shares are held by institutional investors. Comparatively, 71.0% of OceanFirst Financial shares are held by institutional investors. 21.1% of Old Point Financial shares are held by insiders. Comparatively, 5.0% of OceanFirst Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Old Point Financial pays an annual dividend of $0.56 per share and has a dividend yield of 1.9%. OceanFirst Financial pays an annual dividend of $0.80 per share and has a dividend yield of 4.5%. Old Point Financial pays out 29.8% of its earnings in the form of a dividend. OceanFirst Financial pays out 48.5% 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.

Summary

OceanFirst Financial beats Old Point Financial on 12 of the 17 factors compared between the two stocks.

About Old Point Financial

Old Point Financial Corporation operates as the bank holding company for The Old Point National Bank of Phoebus that provides consumer, mortgage, and business banking services for individual and commercial customers in Virginia. It offers deposit products, including interest-bearing transaction accounts, money market deposit accounts, savings accounts, time deposits, and demand deposits. The company also provides real estate construction, commercial, and mortgage loans, such as residential 1-4 family mortgages, second mortgages, and equity lines of credit; and other loans. In addition, it offers retirement planning, estate planning, financial planning, estate and trust administration, retirement plan administration, tax, and investment management services; and insurance products, wealth management, and cash management services. Old Point Financial Corporation was founded in 1922 and is headquartered in Hampton, Virginia.

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.