Canadian Imperial Bank of Commerce (NYSE:CM) and Banco de Chile (NYSE:BCH) are both large-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.
Profitability
This table compares Canadian Imperial Bank of Commerce and Banco de Chile's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Canadian Imperial Bank of Commerce | 15.06% | 12.03% | 0.61% |
| Banco de Chile | 19.06% | 13.35% | 1.11% |
Insider and Institutional Ownership
42.6% of Canadian Imperial Bank of Commerce shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares Canadian Imperial Bank of Commerce and Banco de Chile's top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Canadian Imperial Bank of Commerce | $18.76 billion | 2.38 | $2.82 billion | $7.21 | 13.84 |
| Banco de Chile | $3.67 billion | 3.39 | $802.98 million | $1.56 | 15.79 |
Canadian Imperial Bank of Commerce has higher revenue and earnings than Banco de Chile. Canadian Imperial Bank of Commerce is trading at a lower price-to-earnings ratio than Banco de Chile, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of current ratings and target prices for Canadian Imperial Bank of Commerce and Banco de Chile, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Canadian Imperial Bank of Commerce | 0 | 4 | 10 | 0 | 2.71 |
| Banco de Chile | 0 | 1 | 2 | 0 | 2.67 |
Canadian Imperial Bank of Commerce presently has a consensus target price of $110.7083, suggesting a potential upside of 10.96%. Banco de Chile has a consensus target price of $24.00, suggesting a potential downside of 2.60%. Given Canadian Imperial Bank of Commerce's stronger consensus rating and higher probable upside, analysts clearly believe Canadian Imperial Bank of Commerce is more favorable than Banco de Chile.
Dividends
Canadian Imperial Bank of Commerce pays an annual dividend of $4.49 per share and has a dividend yield of 4.5%. Banco de Chile pays an annual dividend of $0.37 per share and has a dividend yield of 1.5%. Canadian Imperial Bank of Commerce pays out 62.3% of its earnings in the form of a dividend. Banco de Chile pays out 23.7% 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. Canadian Imperial Bank of Commerce has increased its dividend for 1 consecutive years. Canadian Imperial Bank of Commerce is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Volatility & Risk
Canadian Imperial Bank of Commerce has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500. Comparatively, Banco de Chile has a beta of 0.52, meaning that its stock price is 48% less volatile than the S&P 500.
Summary
Canadian Imperial Bank of Commerce beats Banco de Chile on 10 of the 16 factors compared between the two stocks.
