Berkshire Hills Bancorp (NYSE: BHLB) and Meta Financial Group (NASDAQ:CASH) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, profitability, analyst recommendations, institutional ownership, earnings, risk and valuation.

Valuation and Earnings

This table compares Berkshire Hills Bancorp and Meta Financial Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Berkshire Hills Bancorp $346.29 million 4.45 $58.67 million $1.86 20.48
Meta Financial Group $280.27 million 3.00 $44.91 million $4.79 18.24

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

Volatility and Risk

Berkshire Hills Bancorp has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500. Comparatively, Meta Financial Group has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.

Dividends

Berkshire Hills Bancorp pays an annual dividend of $0.84 per share and has a dividend yield of 2.2%. Meta Financial Group pays an annual dividend of $0.52 per share and has a dividend yield of 0.6%. Berkshire Hills Bancorp pays out 45.2% of its earnings in the form of a dividend. Meta Financial Group pays out 10.9% 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. Meta Financial Group has increased its dividend for 2 consecutive years.

Insider & Institutional Ownership

75.0% of Berkshire Hills Bancorp shares are owned by institutional investors. Comparatively, 72.3% of Meta Financial Group shares are owned by institutional investors. 1.7% of Berkshire Hills Bancorp shares are owned by company insiders. Comparatively, 6.1% of Meta Financial Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Berkshire Hills Bancorp and Meta Financial Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Berkshire Hills Bancorp 15.54% 7.13% 0.88%
Meta Financial Group 16.03% 15.91% 1.50%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Berkshire Hills Bancorp and Meta Financial Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Berkshire Hills Bancorp 0 2 3 0 2.60
Meta Financial Group 0 0 3 0 3.00

Berkshire Hills Bancorp currently has a consensus target price of $38.10, suggesting a potential upside of 0.00%. Meta Financial Group has a consensus target price of $92.67, suggesting a potential upside of 6.09%. Given Meta Financial Group’s stronger consensus rating and higher possible upside, analysts clearly believe Meta Financial Group is more favorable than Berkshire Hills Bancorp.

Summary

Meta Financial Group beats Berkshire Hills Bancorp on 10 of the 16 factors compared between the two stocks.

Berkshire Hills Bancorp Company Profile

Berkshire Hills Bancorp, Inc. (Berkshire) is a holding company for Berkshire Bank (the Bank) and Berkshire Insurance Group. Berkshire offers a range of deposit, lending, insurance and wealth management products to retail, commercial, not-for-profit and municipal customers in its market areas. Berkshire product offerings also include retail and commercial electronic banking, commercial cash management and commercial interest rate swaps. The Bank’s loan portfolio consists of commercial loans, which include residential mortgages, commercial real estate, commercial and industrial loans, and consumer loans. The Bank’s securities available for sale include municipal bonds and obligations, mortgage-backed securities, other bonds and obligations, and marketable equity securities. As of October 16, 2017, the Bank had 113 full service branch offices in Massachusetts, New York, Connecticut, Vermont, New Jersey and Pennsylvania.

Meta Financial Group Company Profile

Meta Financial Group, Inc. is a unitary savings and loan holding company. The Company operates through its banking subsidiary, MetaBank (the Bank). Its segments include Payments, Banking, and Corporate Services/Other. MetaBank is both a community-oriented financial institution offering a range of financial services to meet the needs of the communities it serves and a payments company providing services on a nationwide basis. It operates in both the banking and payments industries through MetaBank, its retail banking operation; Meta Payment Systems (MPS), its electronic payments division; AFS/IBEX Financial Services Inc. (AFS/IBEX), its insurance premium financing division, and Refund Advantage, EPS Financial, LLC (EPS) Financial and Specialty Consumer Services, its tax-related financial solutions divisions.

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