Timberland Bancorp (NASDAQ:TSBK – Get Free Report) and West Bancorporation (NASDAQ:WTBA – Get Free Report) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, risk, profitability, institutional ownership, analyst recommendations, dividends and earnings.
Volatility and Risk
Timberland Bancorp has a beta of 0.36, suggesting that its stock price is 64% less volatile than the S&P 500. Comparatively, West Bancorporation has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of recent ratings and target prices for Timberland Bancorp and West Bancorporation, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Timberland Bancorp | 0 | 0 | 1 | 0 | 3.00 |
| West Bancorporation | 0 | 1 | 1 | 1 | 3.00 |
Institutional & Insider Ownership
65.5% of Timberland Bancorp shares are owned by institutional investors. Comparatively, 44.3% of West Bancorporation shares are owned by institutional investors. 3.6% of Timberland Bancorp shares are owned by insiders. Comparatively, 4.6% of West Bancorporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Profitability
This table compares Timberland Bancorp and West Bancorporation’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Timberland Bancorp | 26.17% | 11.86% | 1.55% |
| West Bancorporation | 16.08% | 14.59% | 0.89% |
Dividends
Timberland Bancorp pays an annual dividend of $1.12 per share and has a dividend yield of 2.8%. West Bancorporation pays an annual dividend of $1.00 per share and has a dividend yield of 3.8%. Timberland Bancorp pays out 29.0% of its earnings in the form of a dividend. West Bancorporation pays out 52.4% 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. Timberland Bancorp has raised its dividend for 13 consecutive years.
Earnings & Valuation
This table compares Timberland Bancorp and West Bancorporation”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Timberland Bancorp | $114.63 million | 2.72 | $29.16 million | $3.86 | 10.27 |
| West Bancorporation | $202.45 million | 2.20 | $32.56 million | $1.91 | 13.77 |
West Bancorporation has higher revenue and earnings than Timberland Bancorp. Timberland Bancorp is trading at a lower price-to-earnings ratio than West Bancorporation, indicating that it is currently the more affordable of the two stocks.
Summary
West Bancorporation beats Timberland Bancorp on 9 of the 16 factors compared between the two stocks.
About Timberland Bancorp
Timberland Bancorp, Inc. operates as the bank holding company for Timberland Bank that provides various community banking services in Washington. It offers various deposit products, including money market deposit, checking, and regular savings accounts, as well as certificates of deposit. The company also provides one-to four-family residential, multi-family, and commercial real estate loans; and construction lending products, such as custom and owner/builder, speculative one- to four-family, commercial, multi-family, land development, and land development. In addition, it offers consumer loans comprising home equity lines of credit and second mortgage loans, automobile loans, boat loans, motorcycle loans, recreational vehicle loans, savings account loans, and unsecured loans; and commercial business loans. Timberland Bancorp, Inc. was founded in 1915 and is headquartered in Hoquiam, Washington.
About West Bancorporation
West Bancorporation, Inc. operates as the financial holding company provides community banking and trust services to individuals and small- to medium-sized businesses in the United States. It offers deposit services, including checking, savings, and money market accounts, as well as time certificates of deposit. The company also provides loan products comprising commercial real estate loans, construction and land development loans, commercial lines of credit, and commercial term loans; consumer loans, including loans extended to individuals for household, family, and other personal expenditures not secured by real estate; and 1-4 family residential mortgages and home equity loans. In addition, it offers online and mobile banking, treasury management services including cash management, client-generated automated clearing house transactions, remote deposit, and fraud protection services; merchant credit card processing and corporate credit cards; and administration of estates, conservatorships, personal trusts, and agency accounts. The company was founded in 1893 and is headquartered in West Des Moines, Iowa.
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