Bancolombia (NYSE:CIB) and First Republic Bank (NYSE:FRC) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, valuation, institutional ownership, profitability and risk.
Valuation and Earnings
This table compares Bancolombia and First Republic Bank's gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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Bancolombia | $6.65 billion | 1.23 | $935.21 million | $3.86 | 8.81 |
First Republic Bank | $4.16 billion | 7.42 | $930.33 million | $5.81 | 30.82 |
Bancolombia has higher revenue and earnings than First Republic Bank. Bancolombia is trading at a lower price-to-earnings ratio than First Republic Bank, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Bancolombia has a beta of 1.32, meaning that its share price is 32% more volatile than the S&P 500. Comparatively, First Republic Bank has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500.
Profitability
This table compares Bancolombia and First Republic Bank's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Bancolombia | 4.78% | 3.35% | 0.37% |
First Republic Bank | 22.95% | 10.96% | 0.81% |
Analyst Recommendations
This is a summary of current ratings and recommmendations for Bancolombia and First Republic Bank, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Bancolombia | 1 | 3 | 0 | 0 | 1.75 |
First Republic Bank | 3 | 8 | 5 | 1 | 2.24 |
Bancolombia presently has a consensus price target of $28.50, suggesting a potential downside of 16.15%. First Republic Bank has a consensus price target of $143.8824, suggesting a potential downside of 19.65%. Given Bancolombia's higher possible upside, equities research analysts plainly believe Bancolombia is more favorable than First Republic Bank.
Insider & Institutional Ownership
95.5% of First Republic Bank shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Dividends
Bancolombia pays an annual dividend of $0.25 per share and has a dividend yield of 0.7%. First Republic Bank pays an annual dividend of $0.80 per share and has a dividend yield of 0.4%. Bancolombia pays out 6.5% of its earnings in the form of a dividend. First Republic Bank pays out 13.8% 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. First Republic Bank has increased its dividend for 7 consecutive years. Bancolombia is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
First Republic Bank beats Bancolombia on 11 of the 17 factors compared between the two stocks.