Head-To-Head Comparison: Fulton Financial (NASDAQ:FULT) and Magyar Bancorp (NASDAQ:MGYR)

Magyar Bancorp (NASDAQ:MGYR) and Fulton Financial (NASDAQ:FULT) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Analyst Ratings

This is a summary of current ratings for Magyar Bancorp and Fulton Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Magyar Bancorp	0	1	0	0	2.00
Fulton Financial	0	4	2	0	2.33

Fulton Financial has a consensus price target of $23.50, indicating a potential downside of 3.85%. Given Fulton Financial’s stronger consensus rating and higher probable upside, analysts plainly believe Fulton Financial is more favorable than Magyar Bancorp.

Insider and Institutional Ownership

46.3% of Magyar Bancorp shares are owned by institutional investors. Comparatively, 72.0% of Fulton Financial shares are owned by institutional investors. 11.1% of Magyar Bancorp shares are owned by company insiders. Comparatively, 0.0% of Fulton Financial 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.

Valuation & Earnings

This table compares Magyar Bancorp and Fulton Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Magyar Bancorp	$37.77 million	3.03	$9.76 million	$1.78	9.94
Fulton Financial	$1.89 billion	2.47	$391.61 million	$2.10	11.64

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

Profitability

This table compares Magyar Bancorp and Fulton Financial’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%
Fulton Financial	20.85%	12.69%	1.28%

Dividends

Magyar Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.3%. Fulton Financial pays an annual dividend of $0.76 per share and has a dividend yield of 3.1%. Magyar Bancorp pays out 22.5% of its earnings in the form of a dividend. Fulton Financial pays out 36.2% 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 raised its dividend for 3 consecutive years and Fulton Financial has raised its dividend for 4 consecutive years. Fulton Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Magyar Bancorp has a beta of 0.22, suggesting that its share price is 78% less volatile than the S&P 500. Comparatively, Fulton Financial has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500.

Summary

Fulton Financial beats Magyar Bancorp on 14 of the 17 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 Fulton Financial

Fulton Financial Corporation operates as a financial holding company that provides consumer and commercial banking products and services in Pennsylvania, Delaware, Maryland, New Jersey, and Virginia. It accepts various checking accounts and savings deposit products, certificates of deposit, and individual retirement accounts. The company offers consumer loans products, including home equity loans and lines of credit, automobile loans, personal lines of credit, and checking account overdraft protection; construction and jumbo residential mortgage loans; and commercial lending products comprising commercial real estate, commercial and industrial, and construction loans, as well as equipment lease financing loans. In addition, it offers letters of credit, cash management services, and traditional deposit products; and wealth management services, including investment management, trust, brokerage, insurance, and investment advisory services. Further, the company owns trust preferred securities; and sells various life insurance products. It provides its products and services through financial center offices, as well as through a network of automated teller machines, telephone banking, mobile banking, and online banking. Fulton Financial Corporation was founded in 1882 and is headquartered in Lancaster, Pennsylvania.