HDFC Bank Limited (NYSE: HDB) and CommunityOne Bancorp (NASDAQ:COB) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, institutional ownership, profitability, valuation, analyst recommendations, risk and dividends.

Analyst Recommendations

This is a breakdown of recent ratings for HDFC Bank Limited and CommunityOne Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
HDFC Bank Limited 0 1 2 0 2.67
CommunityOne Bancorp 0 0 0 0 N/A

Valuation & Earnings

This table compares HDFC Bank Limited and CommunityOne Bancorp’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
HDFC Bank Limited $12.17 billion 6.59 $2.17 billion $2.66 35.31
CommunityOne Bancorp N/A N/A N/A $0.40 35.25

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

Profitability

This table compares HDFC Bank Limited and CommunityOne Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
HDFC Bank Limited 18.00% 15.22% 1.74%
CommunityOne Bancorp 16.60% 5.49% 0.66%

Insider & Institutional Ownership

17.8% of HDFC Bank Limited shares are held by institutional investors. Comparatively, 65.8% of CommunityOne Bancorp shares are held by institutional investors. 1.0% of HDFC Bank Limited shares are held by insiders. Comparatively, 49.2% of CommunityOne Bancorp shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

HDFC Bank Limited pays an annual dividend of $0.49 per share and has a dividend yield of 0.5%. CommunityOne Bancorp does not pay a dividend. HDFC Bank Limited pays out 18.4% of its earnings in the form of a dividend. CommunityOne Bancorp has raised its dividend for 4 consecutive years.

Summary

HDFC Bank Limited beats CommunityOne Bancorp on 7 of the 11 factors compared between the two stocks.

HDFC Bank Limited Company Profile

HDFC Bank Limited (the Bank) is a holding company. The Bank offers a range of banking services covering commercial and investment banking on the wholesale side and transactional/branch banking on the retail side. It also offers financial services. The Bank’s segments include Treasury, Retail banking, Wholesale banking and Other banking business. The Treasury segment primarily consists of net interest earnings from the Bank’s investment portfolio, money market borrowing and lending, gains or losses on investment operations and on account of trading in foreign exchange and derivative contracts. The Retail Banking segment serves retail customers through a branch network and other delivery channels, as well as through alternative delivery channels. The Bank provides its corporate and institutional clients a range of commercial and transactional banking products. The Other banking business segment includes income from para banking activities.

CommunityOne Bancorp Company Profile

CommunityOne Bancorp (COB) is a bank holding company. The Company, through the ownership of CommunityOne Bank, N.A., or the Bank, a national banking association, offers consumer, mortgage and business banking services, including loan, deposit, treasury management, online and mobile banking services, as well as wealth management and trust services, to individual, and small and middle market businesses through financial centers located across central, southern and western North Carolina. The Bank operates over 40 branches. In addition to the Bank, the Company owns FNB United Statutory Trust I, FNB United Statutory Trust II, and Catawba Valley Capital Trust II, which were formed to facilitate the issuance of trust preferred securities. The Bank’s loans totaled approximately $1.54 billion. The Bank’s total investment securities totaled approximately $546.782 million. The Bank’s deposits totaled approximately $1.95 billion.

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