Critical Analysis: Magyar Bancorp (NASDAQ:MGYR) versus Glen Burnie Bancorp (NASDAQ:GLBZ)

Magyar Bancorp (NASDAQ:MGYR) and Glen Burnie Bancorp (NASDAQ:GLBZ) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, risk, profitability, analyst recommendations and institutional ownership.

Institutional and Insider Ownership

46.3% of Magyar Bancorp shares are owned by institutional investors. Comparatively, 9.8% of Glen Burnie Bancorp shares are owned by institutional investors. 11.1% of Magyar Bancorp shares are owned by insiders. Comparatively, 14.6% of Glen Burnie Bancorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Magyar Bancorp and Glen Burnie Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Magyar Bancorp	18.32%	9.28%	1.09%
Glen Burnie Bancorp	0.16%	0.14%	0.01%

Dividends

Magyar Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.3%. Glen Burnie Bancorp pays an annual dividend of $0.10 per share and has a dividend yield of 2.2%. Magyar Bancorp pays out 22.5% of its earnings in the form of a dividend. Glen Burnie Bancorp pays out -333.3% 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. Magyar Bancorp has increased its dividend for 3 consecutive years. Magyar Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Magyar Bancorp and Glen Burnie Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Magyar Bancorp	0	1	0	0	2.00
Glen Burnie Bancorp	1	0	0	0	1.00

Volatility & Risk

Magyar Bancorp has a beta of 0.23, meaning that its share price is 77% less volatile than the S&P 500. Comparatively, Glen Burnie Bancorp has a beta of 0.19, meaning that its share price is 81% less volatile than the S&P 500.

Valuation and Earnings

This table compares Magyar Bancorp and Glen Burnie Bancorp”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Magyar Bancorp	$58.42 million	1.93	$9.76 million	$1.78	9.83
Glen Burnie Bancorp	$11.83 million	1.13	-$110,000.00	($0.03)	-151.67

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

Summary

Magyar Bancorp beats Glen Burnie Bancorp on 12 of the 15 factors compared between the two stocks.

About Magyar Bancorp

Magyar Bancorp, Inc. operates as the holding company for Magyar Bank that provides various consumer and commercial banking services to individuals, businesses, and nonprofit organizations in New Jersey, the United States. It accepts various deposit accounts, including demand, savings, NOW, money market, and retirement accounts, as well as certificates of deposit. The company also provides residential mortgage loans, multi-family and commercial real estate mortgage loans, home equity loans and lines of credit, commercial business loans, and construction loans, as well as small business administration loans. In addition, it offers non-deposit investment products and financial planning services, including insurance products, fixed and variable annuities, and retirement planning for individual and commercial customers; and buys, sells, and holds investment securities. The company has branch offices located in New Brunswick, North Brunswick, South Brunswick, Branchburg, Bridgewater, and Edison, New Jersey. Magyar Bancorp, Inc. was founded in 1922 and is headquartered in New Brunswick, New Jersey.

About Glen Burnie Bancorp

Glen Burnie Bancorp operates as the bank holding company for The Bank of Glen Burnie that provides commercial and retail banking services to individuals, associations, partnerships, and corporations. The company offers savings accounts, money market deposit accounts, demand deposit accounts, NOW checking accounts, IRA and SEP accounts, and certificates of deposit. It also provides residential and commercial real estate, construction, land acquisition and development, and secured and unsecured commercial loans, as well as consumer instalment lending, such as indirect automobile lending services; and residential first and second mortgage loans, home equity lines of credit, and commercial mortgage loans. In addition, the company offers safe deposit boxes, money orders, night depositories, automated clearinghouse transactions, wire transfers, and automated teller machine (ATM) services, as well as electronic banking services, such as telephone and online banking, bill pay, card management and control, mobile app, merchant source capture, mobile deposit capture, Zelle, etc. Further, it provides treasury services, including wire transfer and ACH services, and debit cards. Additionally, the company engages in the acquisition and disposition of other real estate properties. It serves customers in northern Anne Arundel county and surrounding areas from its main office and branch in Glen Burnie, Maryland; and branch offices in Odenton, Riviera Beach, Crownsville, Severn, Linthicum, and Severna Park, Maryland. The company also operates a remote ATM located in Pasadena, Maryland. The company was founded in 1949 and is based in Glen Burnie, Maryland.