Peapack-Gladstone Financial (NASDAQ:PGC) and Banco de Chile (NYSE:BCH) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, earnings, valuation, dividends, profitability, risk and analyst recommendations.
This is a breakdown of current ratings and price targets for Peapack-Gladstone Financial and Banco de Chile, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Banco de Chile||0||2||1||0||2.33|
Peapack-Gladstone Financial currently has a consensus target price of $36.50, suggesting a potential upside of 35.19%. Banco de Chile has a consensus target price of $52.50, suggesting a potential upside of 82.04%. Given Banco de Chile’s higher possible upside, analysts clearly believe Banco de Chile is more favorable than Peapack-Gladstone Financial.
This table compares Peapack-Gladstone Financial and Banco de Chile’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Banco de Chile||23.67%||17.06%||1.61%|
Volatility and Risk
Peapack-Gladstone Financial has a beta of 0.98, suggesting that its share price is 2% less volatile than the S&P 500. Comparatively, Banco de Chile has a beta of 0.42, suggesting that its share price is 58% less volatile than the S&P 500.
Earnings and Valuation
This table compares Peapack-Gladstone Financial and Banco de Chile’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Peapack-Gladstone Financial||$203.88 million||2.58||$44.17 million||$2.31||11.69|
|Banco de Chile||$3.61 billion||4.03||$870.29 million||$1.70||16.96|
Banco de Chile has higher revenue and earnings than Peapack-Gladstone Financial. Peapack-Gladstone Financial 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.
Institutional & Insider Ownership
72.6% of Peapack-Gladstone Financial shares are owned by institutional investors. Comparatively, 1.2% of Banco de Chile shares are owned by institutional investors. 4.1% of Peapack-Gladstone Financial shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Peapack-Gladstone Financial pays an annual dividend of $0.20 per share and has a dividend yield of 0.7%. Banco de Chile pays an annual dividend of $0.79 per share and has a dividend yield of 2.7%. Peapack-Gladstone Financial pays out 8.7% of its earnings in the form of a dividend. Banco de Chile pays out 46.5% 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. Banco de Chile has increased its dividend for 7 consecutive years. Banco de Chile is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Banco de Chile beats Peapack-Gladstone Financial on 10 of the 17 factors compared between the two stocks.
About Peapack-Gladstone Financial
Peapack-Gladstone Financial Corporation operates as the bank holding company for Peapack-Gladstone Bank that provides private banking and wealth management services in the United States. The company operates in two segments, Banking and Private Wealth Management. It offers checking and savings accounts, money market and interest-bearing checking accounts, certificates of deposit, and individual retirement accounts. The company also provides working capital lines of credit, term loans for fixed asset acquisitions, commercial mortgages, multi-family mortgages, and other forms of asset-based financing services; and residential mortgages, home equity lines of credit, and other second mortgage loans. In addition, it offers asset management services; personal trust services, including services as executor, trustee, administrator, custodian, and guardian; and other financial planning, tax preparation, and advisory services. Further, the company operates automated teller machines at 24 locations; and provides telephone and Internet banking, merchant credit card, and customer support sales services. Its private banking clients include businesses, non-profits, and consumers; and wealth management clients comprise individuals, families, foundations, endowments, trusts, and estates. The company operates its private banking locations in Bedminster, Morristown, Princeton, and Teaneck, New Jersey; and wealth management branches in Somerset, Morris, Hunterdon, and Union counties. Peapack-Gladstone Financial Corporation was founded in 1921 and is based in Bedminster, New Jersey.
About Banco de Chile
Banco de Chile, together with its subsidiaries, provides banking and financial products and services to customers in Chile. The company operates through four segments: Retail, Wholesale, Treasury and Money Market Operations, and Subsidiaries. It offers deposit products, such as checking accounts, current accounts, demand deposits, demand accounts, saving accounts, and time deposits; credit cards; installment loans; credit lines; and residential mortgage loans, as well as short and long term financing. The company also provides commercial loans, such as factoring and leasing; trade finance services; liquidity management services, debt instruments, foreign trade, and derivative contracts; capital market services; cash management and non-lending services that include payroll, payment, and collection services, as well as treasury, financial advisory, and risk management products. In addition, it offers financial services, such as securities brokerage, mutual funds management, investment banking, insurance brokerage, and securitization services. The company serves customers in individuals; small and medium enterprises; and wholesale customers. As of December 31, 2017, it operated through 399 branches comprising 253 branches under the Banco de Chile brand name, 41 branches under the Banco Edwards Citi brand name, and 105 branches under the Banco CrediChile brand name, as well as 1,464 automatic teller machines. Banco de Chile was founded in 1855 and is headquartered in Santiago, Chile.
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