Provident Bancorp (NASDAQ:PVBC – Get Free Report) and Berkshire Hills Bancorp (NYSE:BHLB – Get Free Report) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, risk, valuation, profitability, institutional ownership and dividends.
Volatility and Risk
Provident Bancorp has a beta of 0.7, meaning that its stock price is 30% less volatile than the S&P 500. Comparatively, Berkshire Hills Bancorp has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500.
Dividends
Provident Bancorp pays an annual dividend of $0.04 per share and has a dividend yield of 0.4%. Berkshire Hills Bancorp pays an annual dividend of $0.72 per share and has a dividend yield of 3.5%. Provident Bancorp pays out -2.4% of its earnings in the form of a dividend. Berkshire Hills Bancorp pays out 31.4% 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. Berkshire Hills Bancorp has raised its dividend for 1 consecutive years. Berkshire Hills Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Provident Bancorp | $75.13 million | 2.23 | -$21.47 million | ($1.65) | -5.73 |
| Berkshire Hills Bancorp | $450.07 million | 1.99 | $92.53 million | $2.29 | 8.90 |
Berkshire Hills Bancorp has higher revenue and earnings than Provident Bancorp. Provident Bancorp is trading at a lower price-to-earnings ratio than Berkshire Hills Bancorp, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
58.6% of Provident Bancorp shares are held by institutional investors. Comparatively, 82.2% of Berkshire Hills Bancorp shares are held by institutional investors. 5.8% of Provident Bancorp shares are held by company insiders. Comparatively, 1.8% of Berkshire Hills Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Profitability
This table compares Provident Bancorp and Berkshire Hills Bancorp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Provident Bancorp | -29.35% | -12.91% | -1.57% |
| Berkshire Hills Bancorp | 17.72% | 11.14% | 0.91% |
Analyst Recommendations
This is a summary of current ratings for Provident Bancorp and Berkshire Hills Bancorp, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Provident Bancorp | 0 | 1 | 0 | 0 | 2.00 |
| Berkshire Hills Bancorp | 2 | 2 | 0 | 0 | 1.50 |
Berkshire Hills Bancorp has a consensus target price of $29.00, indicating a potential upside of 42.37%. Given Berkshire Hills Bancorp’s higher possible upside, analysts clearly believe Berkshire Hills Bancorp is more favorable than Provident Bancorp.
Summary
Berkshire Hills Bancorp beats Provident Bancorp on 12 of the 16 factors compared between the two stocks.
About Provident Bancorp
Provident Bancorp, Inc. is a Maryland corporation that was formed in 2019 to be the successor corporation to Provident Bancorp, Inc., a Massachusetts corporation, and the holding company for The Provident Bank. The Provident Bank, a subsidiary of Provident Bancorp, Inc. is an innovative, commercial bank that finds solutions for its business and private clients.
About Berkshire Hills Bancorp
Berkshire Hills Bancorp, Inc. operates as the bank holding company for Berkshire Bank that provides various banking products and services. It offers various deposit accounts, including demand deposit, interest-bearing checking, regular savings, money market savings, time certificates of deposit, and retirement deposit accounts; and loans, such as commercial real estate, commercial and industrial, consumer, and residential mortgage loans. The company also provides wealth management services comprising investment management, trust administration, tax return preparation, and financial planning; and investment products and brokerage services. In addition, it offers electronic banking, commercial cash management, online banking, small business banking, asset based lending, and mobile banking services; and debit cards and other electronic fee producing payment services to transaction account customers. The company serves personal, commercial, non-profit, and municipal deposit customers. It also has financial centers in Massachusetts, New York, Connecticut, Rhode Island, and Vermont. The company was founded in 1846 and is headquartered in Boston, Massachusetts.
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