Heritage Financial (NASDAQ:HFWA) vs. Carver Bancorp (NASDAQ:CARV) Head to Head Contrast

Carver Bancorp (NASDAQ:CARV) and Heritage Financial (NASDAQ:HFWA) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, institutional ownership, valuation, earnings, dividends, analyst recommendations and risk.

Profitability

This table compares Carver Bancorp and Heritage Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Carver Bancorp	-34.89%	-171.55%	-1.82%
Heritage Financial	17.27%	8.21%	1.03%

Valuation and Earnings

This table compares Carver Bancorp and Heritage Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Carver Bancorp	$22.74 million	0.28	-$13.74 million	($2.49)	-0.49
Heritage Financial	$317.18 million	2.62	$43.26 million	$1.65	14.82

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

Risk & Volatility

Carver Bancorp has a beta of 1.5, suggesting that its share price is 50% more volatile than the S&P 500. Comparatively, Heritage Financial has a beta of 0.52, suggesting that its share price is 48% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for Carver Bancorp and Heritage Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Carver Bancorp	1	0	0	0	1.00
Heritage Financial	0	3	2	0	2.40

Heritage Financial has a consensus price target of $29.33, indicating a potential upside of 19.97%. Given Heritage Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Heritage Financial is more favorable than Carver Bancorp.

Institutional & Insider Ownership

18.2% of Carver Bancorp shares are held by institutional investors. Comparatively, 78.3% of Heritage Financial shares are held by institutional investors. 1.3% of Carver Bancorp shares are held by company insiders. Comparatively, 1.8% of Heritage Financial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Heritage Financial beats Carver Bancorp on 13 of the 14 factors compared between the two stocks.

About Carver Bancorp

Carver Bancorp, Inc. operates as the holding company for Carver Federal Savings Bank that provides consumer and commercial banking services for consumers, businesses, non-profit organizations, and governmental and quasi-governmental agencies primarily in New York. It accepts various deposit products, including demand, savings, and time deposits; passbook and statement accounts, and certificates of deposit; and individual retirement accounts. The company provides lending products, such as one-to-four family residential, multifamily real estate, and commercial real estate lending; and construction, business and small business administration, and consumer and other loans. In addition, it offers other consumer and commercial banking products and services, including debit cards, online account opening and banking, online bill pay, and telephone banking, as well as check cashing, wire transfer, bill payment, reloadable prepaid card, and money order services. Carver Bancorp, Inc. was founded in 1948 and is headquartered in New York, New York.

About Heritage Financial

Heritage Financial Corporation operates as the bank holding company for Heritage Bank that provides various financial services to small and medium sized businesses and individuals in the United States. It accepts various deposit products, such as noninterest demand deposits, interest bearing demand deposits, money market accounts, savings accounts, personal checking accounts, and certificates of deposit. The company’s loan portfolio includes commercial and industrial loans, owner-occupied and non-owner occupied commercial real estate loans, one-to-four family residential loans, real estate construction and land development loans, consumer loans, commercial business loans, lines of credit, term equipment financing, and term real estate loans, as well as commercial business loans to a range of businesses in industries that include real estate and rental and leasing, healthcare, accommodation and food services, retail trade, and construction. It also originates loans that are guaranteed by the U.S. Small Business Administration; and provides objective advice from trusted advisers. The company was formerly known as Heritage Financial Corporation, M.H.C. and changed its name to Heritage Financial Corporation in 1998. Heritage Financial Corporation was founded in 1927 and is headquartered in Olympia, Washington.