Contrasting Cathay General Bancorp (NASDAQ:CATY) and WSFS Financial Corporation (WSFS)
WSFS Financial Corporation (NASDAQ: WSFS) and Cathay General Bancorp (NASDAQ:CATY) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their dividends, analyst recommendations, profitabiliy, earnings, risk, institutional ownership and valuation.
This table compares WSFS Financial Corporation and Cathay General Bancorp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|WSFS Financial Corporation||20.09%||10.14%||1.04%|
|Cathay General Bancorp||32.94%||9.83%||1.26%|
Risk & Volatility
WSFS Financial Corporation has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500. Comparatively, Cathay General Bancorp has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500.
This is a summary of recent ratings and target prices for WSFS Financial Corporation and Cathay General Bancorp, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|WSFS Financial Corporation||0||0||2||0||3.00|
|Cathay General Bancorp||0||2||1||0||2.33|
WSFS Financial Corporation currently has a consensus price target of $52.50, suggesting a potential upside of 14.88%. Cathay General Bancorp has a consensus price target of $39.33, suggesting a potential upside of 5.56%. Given WSFS Financial Corporation’s stronger consensus rating and higher possible upside, equities research analysts clearly believe WSFS Financial Corporation is more favorable than Cathay General Bancorp.
WSFS Financial Corporation pays an annual dividend of $0.28 per share and has a dividend yield of 0.6%. Cathay General Bancorp pays an annual dividend of $0.84 per share and has a dividend yield of 2.3%. WSFS Financial Corporation pays out 13.1% of its earnings in the form of a dividend. Cathay General Bancorp pays out 37.7% 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.
Insider and Institutional Ownership
78.3% of WSFS Financial Corporation shares are held by institutional investors. Comparatively, 68.1% of Cathay General Bancorp shares are held by institutional investors. 4.9% of WSFS Financial Corporation shares are held by company insiders. Comparatively, 5.8% of Cathay General Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares WSFS Financial Corporation and Cathay General Bancorp’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|WSFS Financial Corporation||$293.90 million||4.89||$67.31 million||$2.14||21.36|
|Cathay General Bancorp||$467.81 million||6.36||$178.03 million||$2.23||16.71|
Cathay General Bancorp has higher revenue and earnings than WSFS Financial Corporation. Cathay General Bancorp is trading at a lower price-to-earnings ratio than WSFS Financial Corporation, indicating that it is currently the more affordable of the two stocks.
Cathay General Bancorp beats WSFS Financial Corporation on 9 of the 16 factors compared between the two stocks.
WSFS Financial Corporation Company Profile
WSFS Financial Corporation is a savings and loan holding company. The Company’s subsidiary is Wilmington Savings Fund Society, FSB (WSFS Bank or the Bank), which is the bank and trust company. It operates in three segments: WSFS Bank, Cash Connect and Wealth Management. The WSFS Bank segment provides loans and other financial products to commercial and retail customers. Its Cash Connect segment provides automated teller machine (ATM) services through strategic partnerships with several of the network, manufacturers and service providers in the ATM industry. The Wealth Management segment provides a range of fiduciary, investment management, credit and deposit products to clients. Its banking business is commercial lending funded by customer-generated deposits. It also offers a range of consumer loan products, retail securities and insurance brokerage services. Its subsidiaries include WSFS Wealth Investments, 1832 Holdings, Inc., Monarch and West Capital Management.
Cathay General Bancorp Company Profile
Cathay General Bancorp is a bank holding company. The Company holds Cathay Bank, a California state-chartered commercial bank (the Bank); seven limited partnerships investing in affordable housing investments; GBC Venture Capital, Inc., and Asia Realty Corp. The Company also owns the common stock of five statutory business trusts created for issuing capital securities. The Bank primarily services individuals, professionals and small to medium-sized businesses in the local markets and provides commercial mortgage loans, commercial loans, small business administration (SBA) loans, residential mortgage loans, real estate construction loans, home equity lines of credit and installment loans to individuals for automobile, household and other consumer expenditures. The Bank offers passbook accounts, checking accounts, money market deposit accounts, certificates of deposit, individual retirement accounts, college certificates of deposit and public funds deposits.
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