Heritage Commerce (NASDAQ:HTBK) vs. Banco Bradesco (NYSE:BBDO) Head-To-Head Survey

Banco Bradesco (NYSE:BBDO) and Heritage Commerce (NASDAQ:HTBK) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, dividends, risk and earnings.

Dividends

Banco Bradesco pays an annual dividend of $0.03 per share and has a dividend yield of 1.1%. Heritage Commerce pays an annual dividend of $0.52 per share and has a dividend yield of 6.1%. Banco Bradesco pays out 12.0% of its earnings in the form of a dividend. Heritage Commerce pays out 42.6% 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 Bradesco has raised its dividend for 1 consecutive years.

Profitability

This table compares Banco Bradesco and Heritage Commerce’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Bradesco	7.80%	9.53%	0.83%
Heritage Commerce	32.20%	11.67%	1.38%

Valuation & Earnings

This table compares Banco Bradesco and Heritage Commerce’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Bradesco	$35.24 billion	0.83	$4.06 billion	$0.25	11.04
Heritage Commerce	$198.94 million	2.61	$66.56 million	$1.22	6.97

Banco Bradesco has higher revenue and earnings than Heritage Commerce. Heritage Commerce is trading at a lower price-to-earnings ratio than Banco Bradesco, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Banco Bradesco has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500. Comparatively, Heritage Commerce has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Banco Bradesco and Heritage Commerce, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Bradesco	0	0	0	0	N/A
Heritage Commerce	0	1	1	0	2.50

Heritage Commerce has a consensus target price of $12.00, suggesting a potential upside of 41.18%. Given Heritage Commerce’s higher probable upside, analysts clearly believe Heritage Commerce is more favorable than Banco Bradesco.

Insider and Institutional Ownership

0.0% of Banco Bradesco shares are held by institutional investors. Comparatively, 72.8% of Heritage Commerce shares are held by institutional investors. 0.3% of Banco Bradesco shares are held by company insiders. Comparatively, 4.1% of Heritage Commerce shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Heritage Commerce beats Banco Bradesco on 11 of the 16 factors compared between the two stocks.

About Banco Bradesco

Banco Bradesco S.A., together with its subsidiaries, provides various banking products and services to individuals, corporates, and businesses in Brazil and internationally. The company operates through two segments, Banking and Insurance. It provides current, savings, click, and salary accounts; real estate credit, vehicle financing, payroll loans, mortgage loans, microcredit, leasing, and personal and installment credit; debit and business cards; financial and security services; consortium products; auto, personal accident, dental, travel, and life insurance; investment products; pension products; real estate and vehicle auctions; cash management, and foreign trade and exchange services; capitalization bonds; and internet banking services. Banco Bradesco S.A. was founded in 1943 and is headquartered in Osasco, Brazil.

About Heritage Commerce

Heritage Commerce Corp operates as the bank holding company for Heritage Bank of Commerce that provides various commercial and personal banking services to residents and the business/professional community in California. Its deposit products for business banking and retail markets include interest and non-interest-bearing demand, savings, and money market accounts, as well as certificates of deposit and time deposits. The company's loan portfolio comprises commercial loans, such as operating secured and unsecured loans advanced for working capital, equipment purchases, and other business purposes; commercial real estate loans; commercial construction loans for rental properties, commercial buildings, and homes; small business administration loans; home equity lines of credit; multifamily loans on residential properties; residential mortgage loans; and consumer loans consisting of loans for financing automobiles, various consumer goods, and other personal purposes. In addition, it offers other banking services, including cashier's checks, bank by mail, night depositories, safe deposit boxes, direct deposit, automated payroll, electronic funds transfer, online bill pay, homeowner association, remote deposit capture, automated clearing house origination, electronic data interchange, and check imaging services, as well as other customary banking, factoring financing, and electronic banking services. Heritage Commerce Corp was founded in 1994 and is headquartered in San Jose, California.