Simmons First National (NASDAQ: SFNC) and Canadian Imperial Bank of Commerce (NYSE:CM) are both mid-cap financials companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, risk, dividends, valuation, earnings, institutional ownership and profitability.
This is a summary of recent ratings for Simmons First National and Canadian Imperial Bank of Commerce, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Simmons First National||0||4||1||0||2.20|
|Canadian Imperial Bank of Commerce||1||2||4||0||2.43|
Volatility & Risk
Simmons First National has a beta of 1.14, indicating that its share price is 14% more volatile than the S&P 500. Comparatively, Canadian Imperial Bank of Commerce has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.
Earnings and Valuation
This table compares Simmons First National and Canadian Imperial Bank of Commerce’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Simmons First National||$440.39 million||6.17||$96.81 million||$3.16||18.72|
|Canadian Imperial Bank of Commerce||$16.73 billion||2.57||$3.59 billion||$9.08||10.79|
Canadian Imperial Bank of Commerce has higher revenue and earnings than Simmons First National. Canadian Imperial Bank of Commerce is trading at a lower price-to-earnings ratio than Simmons First National, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
51.3% of Simmons First National shares are owned by institutional investors. Comparatively, 44.4% of Canadian Imperial Bank of Commerce shares are owned by institutional investors. 4.6% of Simmons First National shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Simmons First National pays an annual dividend of $1.00 per share and has a dividend yield of 1.7%. Canadian Imperial Bank of Commerce pays an annual dividend of $4.04 per share and has a dividend yield of 4.1%. Simmons First National pays out 31.6% of its earnings in the form of a dividend. Canadian Imperial Bank of Commerce pays out 44.5% 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. Simmons First National has increased its dividend for 2 consecutive years.
This table compares Simmons First National and Canadian Imperial Bank of Commerce’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Simmons First National||21.58%||8.79%||1.19%|
|Canadian Imperial Bank of Commerce||22.45%||17.57%||0.86%|
Canadian Imperial Bank of Commerce beats Simmons First National on 9 of the 17 factors compared between the two stocks.
About Simmons First National
Simmons First National Corporation is a financial holding company. The Company, through its subsidiary bank, Simmons Bank, provides financial services to individuals and businesses throughout the market areas they serve. As of December 31, 2016, Simmons Bank conducted banking operations through 150 financial centers located in communities throughout Arkansas, Kansas, Missouri, Tennessee, Colorado, Oklahoma and Texas. Simmons Bank offers consumer, real estate and commercial loans, checking and savings deposits. Simmons Bank and its subsidiaries have also developed products and services, which include credit cards, investments, agricultural finance lending, equipment lending, insurance and small business administration lending. The securities within the portfolio are classified as either held-to-maturity, available-for-sale or trading. The Company offers deposits, including non-interest bearing transaction accounts; interest bearing transaction accounts, and time deposits.
About Canadian Imperial Bank of Commerce
Canadian Imperial Bank of Commerce (CIBC) is a global financial institution. The Company provides a range of financial products and services to approximately 11 million individual, small business, commercial, corporate and institutional clients in Canada and around the world. The Company operates through three segments: Retail and Business Banking, Wealth Management and Capital Markets. The Company’s Retail and Business Banking segment provides personal and business clients across Canada with financial advice, products and services in its banking centers or through remote channels, such as mobile advisors, telephone, online or mobile banking. The Company’s Wealth Management segment provides advice and investment solutions. The Company’s Capital Markets segment provides integrated credit and global markets products, investment banking advisory services and research to corporate, government and institutional clients around the world.
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