Wellesley Bancorp (NASDAQ:WEBK) and United Financial Bancorp (NASDAQ:UBNK) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, dividends, institutional ownership, earnings, analyst recommendations, profitability and valuation.
Profitability
This table compares Wellesley Bancorp and United Financial Bancorp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Wellesley Bancorp | 16.54% | 9.74% | 0.72% |
| United Financial Bancorp | 19.34% | 8.53% | 0.84% |
10.4% of Wellesley Bancorp shares are owned by institutional investors. Comparatively, 67.5% of United Financial Bancorp shares are owned by institutional investors. 16.7% of Wellesley Bancorp shares are owned by insiders. Comparatively, 3.4% of United Financial Bancorp shares are owned 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.
Analyst Ratings
This is a summary of current ratings for Wellesley Bancorp and United Financial Bancorp, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Wellesley Bancorp | 0 | 0 | 0 | 0 | N/A |
| United Financial Bancorp | 0 | 1 | 0 | 0 | 2.00 |
Risk and Volatility
Wellesley Bancorp has a beta of 0.94, suggesting that its share price is 6% less volatile than the S&P 500. Comparatively, United Financial Bancorp has a beta of 0.73, suggesting that its share price is 27% less volatile than the S&P 500.
Dividends
Wellesley Bancorp pays an annual dividend of $0.22 per share and has a dividend yield of 0.7%. United Financial Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 3.1%. United Financial Bancorp pays out 41.0% of its earnings in the form of a dividend. Wellesley Bancorp has increased its dividend for 3 consecutive years.
Earnings and Valuation
This table compares Wellesley Bancorp and United Financial Bancorp’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Wellesley Bancorp | $36.22 million | 2.18 | $5.99 million | N/A | N/A |
| United Financial Bancorp | $309.73 million | 2.56 | $59.91 million | $1.17 | 13.30 |
United Financial Bancorp has higher revenue and earnings than Wellesley Bancorp.
Summary
United Financial Bancorp beats Wellesley Bancorp on 7 of the 13 factors compared between the two stocks.
About Wellesley Bancorp
Wellesley Bancorp, Inc. operates as the bank holding company for Wellesley Bank that provides various financial services to individuals, non-profit organizations, small businesses, and other entities in eastern Massachusetts. Its deposit products include noninterest-bearing demand deposits, such as checking accounts; interest-bearing demand accounts comprising negotiable order of withdrawal and money market accounts; savings accounts; and certificates of deposit. The company also offers residential mortgage loans, commercial real estate loans, and construction loans, as well as home equity lines of credit; other consumer loans that consist of fixed-rate second mortgage loans, automobile loans, loans secured by passbook or certificate accounts, and overdraft loans; and commercial business loans, such as term loans, revolving lines of credit, and equipment loans. In addition, it provides investment advisory services and remote capture products; and engages in buying, selling, and holding securities. As of December 31, 2017, Wellesley Bancorp, Inc. operated through executive offices and five full service branch offices located in Wellesley, Newton, and Boston; limited- hour branch service office in Needham, Massachusetts; and one full-service branch office in Newton Centre and Boston, as well as wealth management offices located in Wellesley. The company was founded in 1911 and is headquartered in Wellesley, Massachusetts.
About United Financial Bancorp
United Financial Bancorp, Inc. operates as the holding company for United Bank that provides retail, commercial, and consumer banking services to individuals, families, and businesses. The company accepts various deposits, such as interest-bearing checking, non-interest-bearing checking, regular savings, money market savings, and time deposits. Its loan products include commercial loans, commercial real estate loans, residential and commercial construction loans, residential real estate loans collateralized by one-to-four family residences, home equity lines of credit, fixed rate loans, marine floor plan loans, and other consumer loans. In addition, the company provides various financial advisory services. It has 53 banking offices, 64 ATMs, and 7 loan production offices in Connecticut and Massachusetts. The company was formerly known as Rockville Financial, Inc. and changed its name to United Financial Bancorp, Inc. in April 2014. United Financial Bancorp, Inc. was founded in 1858 and is headquartered in Hartford, Connecticut.
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