Analyzing BEO Bancorp (OTCMKTS:BEOB) & Investar (NASDAQ:ISTR)

BEO Bancorp (OTCMKTS:BEOB) and Investar (NASDAQ:ISTR) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Insider and Institutional Ownership

50.2% of Investar shares are held by institutional investors. 8.7% of Investar shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility and Risk

BEO Bancorp has a beta of 0.29, suggesting that its stock price is 71% less volatile than the S&P 500. Comparatively, Investar has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for BEO Bancorp and Investar, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BEO Bancorp	0	0	0	0	0.00
Investar	0	0	1	0	3.00

Investar has a consensus target price of $20.00, suggesting a potential downside of 16.04%. Given Investar’s stronger consensus rating and higher possible upside, analysts plainly believe Investar is more favorable than BEO Bancorp.

Profitability

This table compares BEO Bancorp and Investar’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BEO Bancorp	N/A	N/A	N/A
Investar	11.35%	6.94%	0.58%

Earnings and Valuation

This table compares BEO Bancorp and Investar”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BEO Bancorp	$51.01 million	1.86	$14.21 million	N/A	N/A
Investar	$80.05 million	2.92	$16.68 million	$1.79	13.31

Investar has higher revenue and earnings than BEO Bancorp.

Dividends

BEO Bancorp pays an annual dividend of $1.15 per share and has a dividend yield of 1.5%. Investar pays an annual dividend of $0.42 per share and has a dividend yield of 1.8%. Investar pays out 23.5% of its earnings in the form of a dividend.

Summary

Investar beats BEO Bancorp on 13 of the 14 factors compared between the two stocks.

About BEO Bancorp

BEO Bancorp operates as the bank holding company for Bank of Eastern Oregon that provides commercial and consumer financing, banking and mortgage lending, and other services in Northeastern Oregon and Southeastern Washington. The company offers checking, money market, time deposits, and savings accounts; and certificates of deposit. It also provides commercial, agricultural, real estate, installment, credit card, mortgage, term, home, construction, farm, and refinancing loans; lines of credit; home enhancement loan programs; Internet banking and bill payment services; business sweep and banking services; and automated teller machines and safe deposit facilities, as well as originates and sells mortgage loans into the secondary market. The company was founded in 1945 and is based in Heppner, Oregon.

About Investar

Investar Holding Corporation operates as the bank holding company for Investar Bank that provides a range of commercial banking products to individuals, professionals, and small to medium-sized businesses in south Louisiana, southeast Texas, and Alabama in the United States. The company offers various deposit products and services, such as savings, checking, money market, and individual retirement accounts, as well as various certificates of deposit; debit and credit cards; internet, mobile, and video banking services; and reciprocal deposit products. It also provides commercial real estate loans; commercial and industrial loans, including working capital lines of credit and equipment loans; loans for the construction of commercial projects, and single family residential and multifamily properties; one-to-four family residential real estate loans, such as second mortgage loans; and consumer loans, such as secured and unsecured installment and term loans, home equity loans and lines of credit, and auto loans, as well as loans for personal, family, and household purposes. In addition, the company offers treasury management products, including remote deposit capture, lockbox payment processing, virtual vault, positive pay, ACH origination, wire transfer, investment sweep accounts, and business internet banking services. Further, it provides various other banking services, such as cashiers' checks, direct deposit of payroll and social security checks, night depository, bank-by-mail, automated teller machines, electronic statements, interactive teller machines, online account opening, and mobile wallet payment services. Investar Holding Corporation was founded in 2006 and is headquartered in Baton Rouge, Louisiana.