Hanover Bancorp (NASDAQ:HNVR – Get Free Report) and Independent Bank Group (NASDAQ:IBTX – Get Free Report) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, risk, dividends, valuation and earnings.
Volatility and Risk
Hanover Bancorp has a beta of -0.23, indicating that its stock price is 123% less volatile than the S&P 500. Comparatively, Independent Bank Group has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500.
Analyst Ratings
This is a summary of recent ratings and recommmendations for Hanover Bancorp and Independent Bank Group, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Hanover Bancorp | 0 | 0 | 1 | 0 | 3.00 |
| Independent Bank Group | 0 | 2 | 4 | 0 | 2.67 |
Earnings and Valuation
This table compares Hanover Bancorp and Independent Bank Group’s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Hanover Bancorp | $113.89 million | 1.10 | $15.16 million | $1.96 | 8.78 |
| Independent Bank Group | $922.84 million | 2.40 | $43.20 million | $2.53 | 21.15 |
Independent Bank Group has higher revenue and earnings than Hanover Bancorp. Hanover Bancorp is trading at a lower price-to-earnings ratio than Independent Bank Group, indicating that it is currently the more affordable of the two stocks.
Dividends
Hanover Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.3%. Independent Bank Group pays an annual dividend of $1.52 per share and has a dividend yield of 2.8%. Hanover Bancorp pays out 20.4% of its earnings in the form of a dividend. Independent Bank Group pays out 60.1% 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.
Profitability
This table compares Hanover Bancorp and Independent Bank Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Hanover Bancorp | 8.70% | 6.33% | 0.52% |
| Independent Bank Group | -43.02% | 4.83% | 0.58% |
Institutional and Insider Ownership
15.0% of Hanover Bancorp shares are owned by institutional investors. Comparatively, 77.9% of Independent Bank Group shares are owned by institutional investors. 24.8% of Hanover Bancorp shares are owned by insiders. Comparatively, 3.5% of Independent Bank Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Summary
Independent Bank Group beats Hanover Bancorp on 10 of the 16 factors compared between the two stocks.
About Hanover Bancorp
Hanover Bancorp, Inc., a bank holding company for Hanover Community Bank, provides personal and business lending and deposit services to businesses, municipalities, and individuals in the New York metro area. The company offers checking, credit cards, debit cards, money market, savings, government and municipal banking, and professional services, as well as time deposits, including certificate of deposit and individual retirement accounts. It also provides business loans, commercial real estate financing, small business administration, lending directory services, and residential mortgage. In addition, the company offers cash management, online and mobile banking, merchant services, and digital solutions. Its banking offices are located in Nassau, Suffolk, Queens, Kings, New York Counties, New York, Monmouth County, Freehold, and New Jersey. The company was founded in 2008 and is headquartered in Mineola, New York.
About Independent Bank Group
Independent Bank Group, Inc., through its subsidiary, Independent Bank provides various commercial banking products and services to businesses, professionals, and individuals in the United States. It accepts various deposit products, including checking and savings accounts, demand deposits, money market accounts, and certificates of deposit. The company also provides commercial real estate loans; commercial construction, land, and land development loans; residential real estate loans; single-family interim construction loans; commercial loans, such as SBA guaranteed loans, business term loans, lines of credit, and energy related loans; agricultural loans for farmers and ranchers; consumer installment loans comprising loans to purchase cars, boats, and other recreational vehicles; and residential mortgages, as well as mortgage warehouse purchase loans. In addition, it offers debit and credit cards, online and mobile banking, estatement, bank-by-mail, and direct deposit services; wealth management services; and business accounts and management services consisting of analyzed business checking, business savings, and treasury management services. The company was incorporated in 2002 and is headquartered in McKinney, Texas.
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