Banco Santander (NYSE: SAN) and Republic Bancorp (NASDAQ:RBCAA) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, valuation, earnings, profitability and analyst recommendations.

Dividends

Banco Santander pays an annual dividend of $0.14 per share and has a dividend yield of 2.1%. Republic Bancorp pays an annual dividend of $0.88 per share and has a dividend yield of 2.1%. Banco Santander pays out 30.4% of its earnings in the form of a dividend. Republic Bancorp pays out 36.2% 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. Banco Santander is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Banco Santander and Republic Bancorp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Banco Santander $48.53 billion 2.17 $6.87 billion $0.46 14.28
Republic Bancorp $231.50 million 3.75 $45.90 million $2.43 17.12

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

Insider and Institutional Ownership

1.3% of Banco Santander shares are held by institutional investors. Comparatively, 24.4% of Republic Bancorp shares are held by institutional investors. 9.5% of Banco Santander shares are held by insiders. Comparatively, 52.3% of Republic Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Banco Santander and Republic Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Banco Santander 14.06% 6.86% 0.52%
Republic Bancorp 19.02% 8.18% 1.05%

Analyst Recommendations

This is a summary of recent ratings and target prices for Banco Santander and Republic Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Banco Santander 1 3 6 0 2.50
Republic Bancorp 0 1 0 0 2.00

Banco Santander presently has a consensus target price of $15.85, suggesting a potential upside of 141.25%. Republic Bancorp has a consensus target price of $41.00, suggesting a potential downside of 1.47%. Given Banco Santander’s stronger consensus rating and higher possible upside, analysts clearly believe Banco Santander is more favorable than Republic Bancorp.

Volatility & Risk

Banco Santander has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500. Comparatively, Republic Bancorp has a beta of 0.53, meaning that its stock price is 47% less volatile than the S&P 500.

About Banco Santander

Banco Santander, S.A. is a retail and commercial bank. The Banks segments include Continental Europe, the United Kingdom, Latin America and the United States. The Continental Europe segment covers all businesses in the Continental Europe. The United Kingdom segment includes the businesses developed by various units and branches in the country. The Latin America segment embraces all its financial activities conducted through its banks and subsidiaries in the region. The United States segment includes the Intermediate Holding Company (IHC) and its subsidiaries Santander Bank, Banco Santander Puerto Rico, Santander Consumer USA, Banco Santander International, Santander Investment Securities, and the Santander branch in New York. The Company’s commercial model satisfies the needs of all types of customers: individuals with various income levels.

About Republic Bancorp

Republic Bancorp, Inc. is a financial holding company of Republic Bank & Trust Company (the Bank) and Republic Insurance Services, Inc. (the Captive). The Bank is a Kentucky-based, state chartered non-member financial institution. The Captive is an insurance subsidiary of the Company. The Company operates through four segments: Traditional Banking, which provides traditional banking products to customers; Warehouse Lending (Warehouse), which provides short-term, revolving credit facilities to mortgage bankers across the United States through mortgage warehouse lines of credit; Mortgage Banking, which originates, sells and services long-term, single family, first lien residential real estate loans, and Republic Processing Group (RPG), which facilitates the receipt and payment of federal and state tax refund products. Republic Bancorp Capital Trust is a subsidiary of Republic Bancorp, Inc.

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