Head-To-Head Contrast: Community West Bancshares (NASDAQ:CWBC) vs. HarborOne Bancorp (NASDAQ:HONE)

HarborOne Bancorp (NASDAQ:HONE) and Community West Bancshares (NASDAQ:CWBC) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, earnings, risk and dividends.

Insider & Institutional Ownership

65.0% of HarborOne Bancorp shares are owned by institutional investors. Comparatively, 33.8% of Community West Bancshares shares are owned by institutional investors. 4.9% of HarborOne Bancorp shares are owned by insiders. Comparatively, 21.1% of Community West Bancshares shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and recommmendations for HarborOne Bancorp and Community West Bancshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HarborOne Bancorp	0	1	0	0	2.00
Community West Bancshares	0	1	2	0	2.67

Community West Bancshares has a consensus price target of $20.33, indicating a potential upside of 16.86%. Given Community West Bancshares’ stronger consensus rating and higher probable upside, analysts clearly believe Community West Bancshares is more favorable than HarborOne Bancorp.

Profitability

This table compares HarborOne Bancorp and Community West Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HarborOne Bancorp	5.38%	4.56%	0.47%
Community West Bancshares	20.04%	11.58%	0.91%

Volatility & Risk

HarborOne Bancorp has a beta of 0.73, indicating that its stock price is 27% less volatile than the S&P 500. Comparatively, Community West Bancshares has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500.

Dividends

HarborOne Bancorp pays an annual dividend of $0.32 per share and has a dividend yield of 3.0%. Community West Bancshares pays an annual dividend of $0.48 per share and has a dividend yield of 2.8%. HarborOne Bancorp pays out 86.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Community West Bancshares pays out 25.4% of its earnings in the form of a dividend. HarborOne Bancorp has raised its dividend for 4 consecutive years and Community West Bancshares has raised its dividend for 1 consecutive years. HarborOne Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares HarborOne Bancorp and Community West Bancshares’ revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HarborOne Bancorp	$286.14 million	1.67	$16.08 million	$0.37	28.65
Community West Bancshares	$109.44 million	1.42	$25.54 million	$1.89	9.21

Community West Bancshares has lower revenue, but higher earnings than HarborOne Bancorp. Community West Bancshares is trading at a lower price-to-earnings ratio than HarborOne Bancorp, indicating that it is currently the more affordable of the two stocks.

Summary

Community West Bancshares beats HarborOne Bancorp on 11 of the 17 factors compared between the two stocks.

About HarborOne Bancorp

HarborOne Bancorp, Inc. operates as the holding company for HarborOne Bank that provides financial services to individuals, families, small and mid-size businesses, and municipalities. The company operates in two segments, HarborOne Bank and HarborOne Mortgage. Its primary deposit products include checking, money market, savings, and term certificate of deposit accounts; and primary lending products comprise commercial real estate, commercial, residential mortgages, home equity, and consumer loans. The company also originates, sells, and services residential mortgage loans. In addition, it provides various educational services, such as free digital content, webinars, and recordings for small business and personal financial education under the HarborOne U name. The company operates through a network of full-service branches located in Massachusetts and Rhode Island, as well as commercial lending offices in each of Boston, Massachusetts, and Providence, Rhode Island, as well as administrative offices in Brockton, Massachusetts, as well as ATM locations in Massachusetts. HarborOne Bancorp, Inc. was founded in 1917 and is headquartered in Brockton, Massachusetts.

About Community West Bancshares

Community West Bancshares operates as the bank holding company for Community West Bank, N.A. that provides various financial products and services in California. The company offers deposit products, such as checking accounts, savings accounts, money market accounts, and fixed rate and fixed maturity certificates of deposits; and cash management products. It also provides commercial, commercial real estate, consumer, manufactured housing, and small business administration loans, as well as agricultural loans for real estate and operating lines; home equity lines of credit collateralized by residential real estate; single family real estate loans; and installment loans consisting of automobile and general-purpose loans. The company serves small to medium-sized businesses and their owners, professionals, high-net worth individuals, and non-profit organizations. Community West Bancshares was founded in 1989 and is headquartered in Goleta, California.