The PNC Financial Services Group (NYSE:PNC) and Community Bank System (NYSE:CBU) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.
Analyst Ratings
This is a summary of current ratings and recommmendations for The PNC Financial Services Group and Community Bank System, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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The PNC Financial Services Group | 1 | 12 | 7 | 0 | 2.30 |
Community Bank System | 0 | 3 | 0 | 0 | 2.00 |
The PNC Financial Services Group presently has a consensus price target of $160.1176, suggesting a potential downside of 11.44%. Community Bank System has a consensus price target of $58.00, suggesting a potential downside of 25.85%. Given The PNC Financial Services Group's stronger consensus rating and higher possible upside, equities analysts plainly believe The PNC Financial Services Group is more favorable than Community Bank System.
Dividends
The PNC Financial Services Group pays an annual dividend of $4.60 per share and has a dividend yield of 2.5%. Community Bank System pays an annual dividend of $1.68 per share and has a dividend yield of 2.1%. The PNC Financial Services Group pays out 40.4% of its earnings in the form of a dividend. Community Bank System pays out 51.1% 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. The PNC Financial Services Group has increased its dividend for 1 consecutive years and Community Bank System has increased its dividend for 11 consecutive years. The PNC Financial Services Group is clearly the better dividend stock, given its higher yield and lower payout ratio.
Valuation & Earnings
This table compares The PNC Financial Services Group and Community Bank System's gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
The PNC Financial Services Group | $21.62 billion | 3.55 | $5.37 billion | $11.39 | 15.87 |
Community Bank System | $616.35 million | 6.85 | $169.06 million | $3.29 | 23.78 |
The PNC Financial Services Group has higher revenue and earnings than Community Bank System. The PNC Financial Services Group is trading at a lower price-to-earnings ratio than Community Bank System, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares The PNC Financial Services Group and Community Bank System's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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The PNC Financial Services Group | 38.16% | 5.97% | 0.69% |
Community Bank System | 25.98% | 8.52% | 1.35% |
Volatility and Risk
The PNC Financial Services Group has a beta of 1.38, meaning that its stock price is 38% more volatile than the S&P 500. Comparatively, Community Bank System has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500.
Institutional & Insider Ownership
80.6% of The PNC Financial Services Group shares are owned by institutional investors. Comparatively, 69.8% of Community Bank System shares are owned by institutional investors. 0.3% of The PNC Financial Services Group shares are owned by insiders. Comparatively, 2.1% of Community Bank System shares are owned by insiders. 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.
Summary
The PNC Financial Services Group beats Community Bank System on 11 of the 17 factors compared between the two stocks.