Washington Trust Bancorp (NASDAQ:WASH) versus Luther Burbank (NASDAQ:LBC) Head-To-Head Comparison

Washington Trust Bancorp (NASDAQ:WASHGet Rating) and Luther Burbank (NASDAQ:LBCGet Rating) 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.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Washington Trust Bancorp and Luther Burbank, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Washington Trust Bancorp 0 2 1 0 2.33
Luther Burbank 0 1 0 0 2.00

Washington Trust Bancorp currently has a consensus target price of $58.00, indicating a potential upside of 8.61%. Given Washington Trust Bancorp’s stronger consensus rating and higher probable upside, analysts plainly believe Washington Trust Bancorp is more favorable than Luther Burbank.

Institutional & Insider Ownership

77.4% of Washington Trust Bancorp shares are owned by institutional investors. Comparatively, 14.9% of Luther Burbank shares are owned by institutional investors. 1.4% of Washington Trust Bancorp shares are owned by insiders. Comparatively, 23.2% of Luther Burbank 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.

Dividends

Washington Trust Bancorp pays an annual dividend of $2.16 per share and has a dividend yield of 4.0%. Luther Burbank pays an annual dividend of $0.48 per share and has a dividend yield of 3.7%. Washington Trust Bancorp pays out 50.2% of its earnings in the form of a dividend. Luther Burbank pays out 26.4% 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. Washington Trust Bancorp has raised its dividend for 12 consecutive years and Luther Burbank has raised its dividend for 1 consecutive years. Washington Trust Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Washington Trust Bancorp and Luther Burbank’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Washington Trust Bancorp 31.97% 13.84% 1.28%
Luther Burbank 40.19% 14.11% 1.30%

Earnings & Valuation

This table compares Washington Trust Bancorp and Luther Burbank’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Washington Trust Bancorp $245.39 million 3.78 $76.87 million $4.30 12.42
Luther Burbank $229.80 million 2.92 $87.75 million $1.82 7.13

Luther Burbank has lower revenue, but higher earnings than Washington Trust Bancorp. Luther Burbank is trading at a lower price-to-earnings ratio than Washington Trust Bancorp, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Washington Trust Bancorp has a beta of 0.77, suggesting that its stock price is 23% less volatile than the S&P 500. Comparatively, Luther Burbank has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500.

Summary

Washington Trust Bancorp beats Luther Burbank on 11 of the 17 factors compared between the two stocks.

About Washington Trust Bancorp

(Get Rating)

Washington Trust Bancorp, Inc. operates as the bank holding company for The Washington Trust Company, of Westerly that offers various banking and financial services to individuals and businesses. The company operates in two segments, Commercial Banking and Wealth Management Services. The Commercial Banking segment provides various commercial and retail lending products, such as commercial real estate loans, including commercial mortgages and construction loans; commercial and industrial loans; residential real estate loans that consist of mortgage and homeowner construction loans; and consumer loans comprising home equity loans and lines of credit, personal installment loans, and loans to individuals secured by general aviation aircraft. This segment also offers deposit accounts, including interest-bearing and noninterest-bearing demand deposits, NOW and savings accounts, money market and retirement deposit accounts, and time deposits, as well as debit card, automated teller machine, telephone banking, internet banking, mobile banking, remote deposit capture, and other cash management services. The Wealth Management Services segment provides investment management; financial planning; personal trust and estate services, such as trustee, personal representative, custodian, and guardian; and settlement of decedents' estates, as well as institutional trust services comprising custody and fiduciary services. This segment serves personal and institutional clients. The company also operates as a licensed broker-dealer; and offers variable annuities and college savings plans. As of December 31, 2021, it had 10 branch offices located in southern Rhode Island, 13 branch offices located in the greater Providence area in Rhode Island, and 1 branch office located in southeastern Connecticut. Washington Trust Bancorp, Inc. was founded in 1800 and is headquartered in Westerly, Rhode Island.

About Luther Burbank

(Get Rating)

Luther Burbank Corporation operates as the bank holding company for Luther Burbank Savings that provides various banking products and services for real estate investors, professionals, entrepreneurs, depositors, and commercial businesses. The company offers interest and noninterest-bearing transaction accounts, certificates of deposit, and money market accounts. It also provides commercial real estate loans, including first mortgage loans for the purchase, refinance, or build-out of tenant improvements on investor-owned multifamily residential properties, as well as loans for the purchase, refinance, or improvement of office, retail, and light industrial properties; single family residential loans; and a portfolio of 30-year fixed rate first mortgage and a forgivable second mortgage. In addition, the company offers ATM, debit cards, online and mobile banking, and real estate investment services; and issues trust preferred securities. As of December 31, 2021, it operated ten full service branches in California located in Sonoma, Marin, Santa Clara, and Los Angeles Counties; one full service branch in Washington located in King County; six loan production offices located throughout California; and a loan production office in Clackamas County, Oregon. Luther Burbank Corporation was founded in 1983 and is headquartered in Santa Rosa, California.

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