Peapack-Gladstone Financial Corporation (NASDAQ: PGC) and Fulton Financial Corporation (NASDAQ:FULT) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, risk, profitability and valuation.

Risk and Volatility

Peapack-Gladstone Financial Corporation has a beta of 1.04, suggesting that its share price is 4% more volatile than the S&P 500. Comparatively, Fulton Financial Corporation has a beta of 1.17, suggesting that its share price is 17% more volatile than the S&P 500.

Dividends

Peapack-Gladstone Financial Corporation pays an annual dividend of $0.20 per share and has a dividend yield of 0.6%. Fulton Financial Corporation pays an annual dividend of $0.44 per share and has a dividend yield of 2.3%. Peapack-Gladstone Financial Corporation pays out 11.3% of its earnings in the form of a dividend. Fulton Financial Corporation pays out 44.4% 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.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Peapack-Gladstone Financial Corporation and Fulton Financial Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Peapack-Gladstone Financial Corporation 0 1 2 0 2.67
Fulton Financial Corporation 1 5 0 0 1.83

Peapack-Gladstone Financial Corporation currently has a consensus target price of $32.00, indicating a potential downside of 7.27%. Fulton Financial Corporation has a consensus target price of $17.90, indicating a potential downside of 7.01%. Given Fulton Financial Corporation’s higher possible upside, analysts clearly believe Fulton Financial Corporation is more favorable than Peapack-Gladstone Financial Corporation.

Profitability

This table compares Peapack-Gladstone Financial Corporation and Fulton Financial Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Peapack-Gladstone Financial Corporation 19.54% 9.12% 0.77%
Fulton Financial Corporation 20.86% 8.02% 0.90%

Institutional and Insider Ownership

67.8% of Peapack-Gladstone Financial Corporation shares are owned by institutional investors. Comparatively, 63.0% of Fulton Financial Corporation shares are owned by institutional investors. 5.9% of Peapack-Gladstone Financial Corporation shares are owned by company insiders. Comparatively, 0.7% of Fulton Financial Corporation shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Peapack-Gladstone Financial Corporation and Fulton Financial Corporation’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Peapack-Gladstone Financial Corporation $124.41 million 4.83 $30.80 million $1.77 19.50
Fulton Financial Corporation $713.65 million 4.72 $173.19 million $0.99 19.44

Fulton Financial Corporation has higher revenue and earnings than Peapack-Gladstone Financial Corporation. Fulton Financial Corporation is trading at a lower price-to-earnings ratio than Peapack-Gladstone Financial Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Peapack-Gladstone Financial Corporation beats Fulton Financial Corporation on 9 of the 16 factors compared between the two stocks.

About Peapack-Gladstone Financial Corporation

Peapack-Gladstone Financial Corporation is a bank holding company. The Company’s principal subsidiary is Peapack-Gladstone Bank (the Bank), which is a state chartered commercial bank. The Company operates through two segments: Banking and Private Wealth Management Division. The Banking segment includes commercial, commercial real estate, multifamily, residential and consumer lending activities; deposit generation; operation of automated teller machines (ATMs); telephone and Internet banking services; merchant credit card services, and customer support sales. The Private Wealth Management Division includes asset management services provided for individuals and institutions; personal trust services, including services as executor, trustee, administrator, custodian and guardian; corporate trust services, including services as trustee for pension and profit sharing plans, and other financial planning and advisory services.

About Fulton Financial Corporation

Fulton Financial Corporation is a financial holding company. The Company is the bank holding company of Fulton Bank N.A. (the Bank). As of December 31, 2016, the Company’s six subsidiary banks were located primarily in suburban or semi-rural geographic markets throughout a five-state region (Pennsylvania, Delaware, Maryland, New Jersey and Virginia). Each of the Company’s subsidiary banks offers a range of consumer and commercial banking products and services in its local market area. Personal banking services include various checking account and savings deposit products, certificates of deposit and individual retirement accounts. The subsidiary banks offer a range of consumer lending products to creditworthy customers in their market areas. Commercial banking services are provided to small and medium sized businesses. It also offers investment management, trust, brokerage, insurance and investment advisory services to consumer and commercial banking customers in its market areas.

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