CPB (NYSE: CPF) and Grupo Financiero Santander Mexico S.A. B. de C.V. (NYSE:BSMX) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, risk, earnings, valuation, profitability, analyst recommendations and dividends.

Profitability

This table compares CPB and Grupo Financiero Santander Mexico S.A. B. de C.V.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CPB 22.59% 9.52% 0.90%
Grupo Financiero Santander Mexico S.A. B. de C.V. 15.97% 15.11% 1.37%

Analyst Ratings

This is a summary of recent ratings and target prices for CPB and Grupo Financiero Santander Mexico S.A. B. de C.V., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CPB 0 2 1 0 2.33
Grupo Financiero Santander Mexico S.A. B. de C.V. 0 2 2 0 2.50

CPB presently has a consensus price target of $30.25, indicating a potential upside of 3.03%. Grupo Financiero Santander Mexico S.A. B. de C.V. has a consensus price target of $9.05, indicating a potential downside of 11.27%. Given CPB’s higher possible upside, analysts plainly believe CPB is more favorable than Grupo Financiero Santander Mexico S.A. B. de C.V..

Insider and Institutional Ownership

91.4% of CPB shares are owned by institutional investors. Comparatively, 31.3% of Grupo Financiero Santander Mexico S.A. B. de C.V. shares are owned by institutional investors. 4.1% of CPB 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.

Earnings & Valuation

This table compares CPB and Grupo Financiero Santander Mexico S.A. B. de C.V.’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
CPB $204.25 million 4.38 $47.79 million $1.57 18.70
Grupo Financiero Santander Mexico S.A. B. de C.V. $2.88 billion 4.80 $894.61 million $0.66 15.45

Grupo Financiero Santander Mexico S.A. B. de C.V. has higher revenue and earnings than CPB. Grupo Financiero Santander Mexico S.A. B. de C.V. is trading at a lower price-to-earnings ratio than CPB, indicating that it is currently the more affordable of the two stocks.

Dividends

CPB pays an annual dividend of $0.72 per share and has a dividend yield of 2.5%. Grupo Financiero Santander Mexico S.A. B. de C.V. pays an annual dividend of $0.55 per share and has a dividend yield of 5.4%. CPB pays out 45.9% of its earnings in the form of a dividend. Grupo Financiero Santander Mexico S.A. B. de C.V. pays out 83.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility and Risk

CPB has a beta of 1.16, suggesting that its stock price is 16% more volatile than the S&P 500. Comparatively, Grupo Financiero Santander Mexico S.A. B. de C.V. has a beta of 1.39, suggesting that its stock price is 39% more volatile than the S&P 500.

Summary

Grupo Financiero Santander Mexico S.A. B. de C.V. beats CPB on 9 of the 16 factors compared between the two stocks.

About CPB

Central Pacific Financial Corp. is the bank holding company of Central Pacific Bank (the Bank). The Company’s segments include Banking Operations, Treasury and All Others. The Banking Operations segment includes construction and real estate development lending, commercial lending, residential mortgage lending, consumer lending, trust services, retail brokerage services and its retail branch offices, which provide a range of deposit and loan products, as well as various other banking services. The Treasury segment is responsible for managing the Company’s investment securities portfolio and wholesale funding activities. The All Others segment includes activities, such as electronic banking, data processing and management of Bank-owned properties. The Company also offers wealth management products and services, such as non-deposit investment products, annuities, insurance, investment management, asset custody, and general consultation and planning services.

About Grupo Financiero Santander Mexico S.A. B. de C.V.

Grupo Financiero Santander Mexico SAB de CV, formerly Santander Mexico Financial Group SAB de CV or Grupo Financiero Santander SAB de CV, is a Mexico-based financial institution. The Company is primarily engaged in the provision of multiple banking services, securities brokerage, financial advice services, as well as other related investment activities. The Company offers its services to both, individual and corporate clients. The Company owns such principal subsidiaries as Banco Santander (Mexico) SA, Casa de Bolsa Santander SA de CV and Zurich Santander Seguros Mexico S.A.

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