Macro Bank (NYSE: BMA) and Bank of the Ozarks (NASDAQ:OZRK) are both mid-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their risk, profitability, earnings, dividends, institutional ownership, analyst recommendations and valuation.

Dividends

Macro Bank pays an annual dividend of $0.75 per share and has a dividend yield of 0.6%. Bank of the Ozarks pays an annual dividend of $0.72 per share and has a dividend yield of 1.6%. Macro Bank pays out 10.1% of its earnings in the form of a dividend. Bank of the Ozarks pays out 24.6% 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. Macro Bank has raised its dividend for 6 consecutive years.

Profitability

This table compares Macro Bank and Bank of the Ozarks’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Macro Bank 17.98% 27.55% 4.53%
Bank of the Ozarks 65.67% 11.85% 1.84%

Analyst Ratings

This is a breakdown of recent ratings for Macro Bank and Bank of the Ozarks, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Macro Bank 1 2 1 0 2.00
Bank of the Ozarks 0 2 6 0 2.75

Macro Bank currently has a consensus price target of $113.70, suggesting a potential downside of 8.30%. Bank of the Ozarks has a consensus price target of $54.13, suggesting a potential upside of 18.44%. Given Bank of the Ozarks’ stronger consensus rating and higher possible upside, analysts plainly believe Bank of the Ozarks is more favorable than Macro Bank.

Volatility & Risk

Macro Bank has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500. Comparatively, Bank of the Ozarks has a beta of 1.54, suggesting that its stock price is 54% more volatile than the S&P 500.

Institutional and Insider Ownership

28.0% of Macro Bank shares are held by institutional investors. Comparatively, 86.6% of Bank of the Ozarks shares are held by institutional investors. 6.7% of Bank of the Ozarks shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Macro Bank and Bank of the Ozarks’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Macro Bank $1.35 billion 6.05 $487.99 million $7.41 16.73
Bank of the Ozarks $854.75 million 6.85 $375.60 million $2.93 15.60

Macro Bank has higher revenue and earnings than Bank of the Ozarks. Bank of the Ozarks is trading at a lower price-to-earnings ratio than Macro Bank, indicating that it is currently the more affordable of the two stocks.

Summary

Bank of the Ozarks beats Macro Bank on 9 of the 17 factors compared between the two stocks.

About Macro Bank

Banco Macro SA is an Argnetina-based financial institution (the Bank) that offers traditional bank products and services to companies, including those operating in regional economies, as well as to individuals. In addition, the Bank performs certain transactions through its subsidiaries, including mainly Banco del Tucuman, Macro Bank Ltd, Macro Securities SA, Macro Fiducia SA and Macro Fondos SGFCI SA. It has approximately two categories of customers, such as retail customers, including individuals and entrepreneurs and corporate customers, which include small, medium and large companies and major corporations. In addition, it provides services to over four provincial governments. It provides its corporate customers with traditional banking products and services, such as deposits, lending (including overdraft facilities), check cashing advances and factoring, guaranteed loans and credit lines for financing foreign trade and cash management services.

About Bank of the Ozarks

Bank of the Ozarks, Inc. is a state chartered bank that provides retail and commercial banking services. Its deposit services include checking, savings, money market, time deposit and individual retirement accounts. Its loan services include various types of real estate, consumer, commercial, industrial and agricultural loans and various leasing services. It also provides mortgage lending; treasury management services for businesses, individuals and non-profit and governmental entities, including wholesale lock box services; remote deposit capture services; trust and wealth management services for businesses, individuals and non-profit and governmental entities, including financial planning, money management, custodial services and corporate trust services; real estate appraisals; automated teller machines (ATMs); telephone banking; online and mobile banking services, including electronic bill pay and consumer mobile deposits, and debit cards, gift cards and safe deposit boxes.

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