Richmond Mutual Bancorporation (NASDAQ:RMBI) vs. HomeStreet (NASDAQ:HMST) Head to Head Contrast

Richmond Mutual Bancorporation (NASDAQ:RMBI) and HomeStreet (NASDAQ:HMST) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.

Institutional & Insider Ownership

26.5% of Richmond Mutual Bancorporation shares are owned by institutional investors. Comparatively, 74.7% of HomeStreet shares are owned by institutional investors. 8.2% of Richmond Mutual Bancorporation shares are owned by company insiders. Comparatively, 4.6% of HomeStreet shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Richmond Mutual Bancorporation and HomeStreet, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Richmond Mutual Bancorporation	0	0	0	0	N/A
HomeStreet	0	3	1	0	2.25

HomeStreet has a consensus target price of $12.00, suggesting a potential upside of 5.26%. Given HomeStreet’s higher possible upside, analysts plainly believe HomeStreet is more favorable than Richmond Mutual Bancorporation.

Volatility and Risk

Richmond Mutual Bancorporation has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500. Comparatively, HomeStreet has a beta of 1.33, suggesting that its share price is 33% more volatile than the S&P 500.

Earnings and Valuation

This table compares Richmond Mutual Bancorporation and HomeStreet’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Richmond Mutual Bancorporation	$72.02 million	1.80	$9.49 million	$0.87	13.49
HomeStreet	$160.81 million	1.34	-$27.51 million	($2.13)	-5.35

Richmond Mutual Bancorporation has higher earnings, but lower revenue than HomeStreet. HomeStreet is trading at a lower price-to-earnings ratio than Richmond Mutual Bancorporation, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Richmond Mutual Bancorporation and HomeStreet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Richmond Mutual Bancorporation	11.72%	6.93%	0.62%
HomeStreet	-8.97%	-0.43%	-0.02%

Dividends

Richmond Mutual Bancorporation pays an annual dividend of $0.56 per share and has a dividend yield of 4.8%. HomeStreet pays an annual dividend of $0.40 per share and has a dividend yield of 3.5%. Richmond Mutual Bancorporation pays out 64.4% of its earnings in the form of a dividend. HomeStreet pays out -18.8% 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. Richmond Mutual Bancorporation has increased its dividend for 3 consecutive years. Richmond Mutual Bancorporation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Richmond Mutual Bancorporation beats HomeStreet on 10 of the 16 factors compared between the two stocks.

About Richmond Mutual Bancorporation

Richmond Mutual Bancorporation, Inc. operates as the bank holding company for First Bank Richmond that provides various banking services. It accepts various deposits, including savings deposit accounts, money market accounts, NOW and demand accounts, and certificates of deposit. The company also offers a range of lending products, such as multi-family and commercial real estate loans, commercial and industrial loans, construction and development loans, residential real estate loans, and consumer loans. In addition, it engages in the lease financing business; and provision of fee-based financial services comprising trust and estate administration, investment management, retirement plan administration, and private banking services. The company was founded in 1887 and is headquartered in Richmond, Indiana.

About HomeStreet

HomeStreet, Inc. operates as the bank holding company for HomeStreet Bank that provides commercial, mortgage, and consumer/retail banking services in the Western United States. The company offers personal and business checking, savings, interest-bearing negotiable order of withdrawal, and money market accounts, as well as certificates of deposit; credit cards; insurance; and treasury management services. Its loan products include commercial real estate (CRE), multifamily, construction and land development, owner occupied CRE and commercial business loans; and single family, home equity, and other loans. In addition, the company offers online, mobile, and telephone banking. It serves small and medium sized businesses, real estate investors, professional firms, and individuals. The company operates through branches and ATMs. The company was formerly known as Continental Mortgage and Loan Company. HomeStreet, Inc. was incorporated in 1921 and is headquartered in Seattle, Washington.