Deutsche Bank (NYSE: DB) and Customers Bancorp (NYSE:CUBI) are both financials companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, earnings, risk, institutional ownership, valuation and profitability.

Institutional and Insider Ownership

20.9% of Deutsche Bank shares are held by institutional investors. Comparatively, 87.8% of Customers Bancorp shares are held by institutional investors. 8.7% of Customers Bancorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

Deutsche Bank has a beta of 1.42, indicating that its stock price is 42% more volatile than the S&P 500. Comparatively, Customers Bancorp has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500.

Profitability

This table compares Deutsche Bank and Customers Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Deutsche Bank -0.42% 3.65% 0.16%
Customers Bancorp 9.01% 2.40% 0.29%

Valuation & Earnings

This table compares Deutsche Bank and Customers Bancorp’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Deutsche Bank $44.58 billion 0.85 -$1.55 billion ($0.59) -31.02
Customers Bancorp $345.70 million 2.49 $78.70 million $2.05 13.61

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

Dividends

Deutsche Bank pays an annual dividend of $0.21 per share and has a dividend yield of 1.1%. Customers Bancorp does not pay a dividend. Deutsche Bank pays out -35.6% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of current recommendations for Deutsche Bank and Customers Bancorp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Deutsche Bank 4 6 1 0 1.73
Customers Bancorp 0 2 2 0 2.50

Deutsche Bank presently has a consensus target price of $18.03, indicating a potential downside of 1.48%. Customers Bancorp has a consensus target price of $42.33, indicating a potential upside of 51.68%. Given Customers Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Customers Bancorp is more favorable than Deutsche Bank.

Summary

Customers Bancorp beats Deutsche Bank on 11 of the 16 factors compared between the two stocks.

Deutsche Bank Company Profile

Deutsche Bank AG is a bank and holding company for its subsidiaries. The Company offers a range of investment, financial and related products and services to private individuals, corporate entities and institutional clients. It operates through six divisions: Global Markets, which offers financial products, including trading and hedging services to institutions and corporate clients; Corporate & Investment Banking, which brings together its commercial banking, corporate finance and transaction banking capability; Private, Wealth and Commercial Clients, which combines its capability in private and commercial banking, as well as in wealth management solutions; Deutsche Asset Management, whose investment capabilities span both active and passive strategies and an array of asset classes, including equities, fixed income, real estate and sustainable investments; Postbank, which is a German financial service provider for retail, business and corporate clients, and Non-Core Operations Unit.

Customers Bancorp Company Profile

Customers Bancorp, Inc. (Customers Bancorp) is a bank holding company engaged in banking activities through its subsidiary, Customers Bank (the Bank). The Bank provides financial products and services to small and middle market businesses, not-for-profits, and consumers through its branches and offices in Southeastern Pennsylvania (Bucks, Berks, Chester, Delaware and Philadelphia Counties), Rye Brook, Melville and New York, New York (Westchester, Suffolk and New York Counties), Hamilton, New Jersey (Mercer County), Providence, Rhode Island (Providence County), Portsmouth, New Hampshire (Rockingham County) and Boston, Massachusetts (Suffolk County). The Bank also provides liquidity to the mortgage market nationwide through the operation of its loans to mortgage banking companies. The Bank offers a range of traditional loan and deposit banking products, and financial services. Customers Bank offers a range of lending products.

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