Financial Review: First Busey (BUSE) & Popular (BPOP)

First Busey (NASDAQ: BUSE) and Popular (NASDAQ:BPOP) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.

Risk & Volatility

First Busey has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500. Comparatively, Popular has a beta of 1.08, meaning that its share price is 8% more volatile than the S&P 500.

Institutional and Insider Ownership

48.1% of First Busey shares are held by institutional investors. Comparatively, 89.8% of Popular shares are held by institutional investors. 11.2% of First Busey shares are held by company insiders. Comparatively, 1.3% of Popular shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for First Busey and Popular, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Busey 0 2 2 0 2.50
Popular 0 1 7 0 2.88

First Busey currently has a consensus target price of $33.75, suggesting a potential upside of 3.37%. Popular has a consensus target price of $49.36, suggesting a potential upside of 7.18%. Given Popular’s stronger consensus rating and higher probable upside, analysts plainly believe Popular is more favorable than First Busey.

Valuation & Earnings

This table compares First Busey and Popular’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Busey $308.78 million 5.15 $62.72 million $1.61 20.28
Popular $2.15 billion 2.20 $107.68 million $2.68 17.18

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

Dividends

First Busey pays an annual dividend of $0.80 per share and has a dividend yield of 2.5%. Popular pays an annual dividend of $1.00 per share and has a dividend yield of 2.2%. First Busey pays out 49.7% of its earnings in the form of a dividend. Popular pays out 37.3% 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.

Profitability

This table compares First Busey and Popular’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Busey 20.74% 9.93% 1.18%
Popular 4.74% 5.29% 0.62%

First Busey Company Profile

First Busey Corporation operates as the bank holding company for Busey Bank that provides retail and commercial banking products and services to individual, corporate, institutional, and governmental customers in the United States. The company operates in three segments: Banking, Remittance Processing, and Wealth Management. It offers customary types of demand and savings deposits; and commercial, agricultural, commercial and residential real estate, and consumer loans, as well as home equity lines of credit. The company also provides money transfer, safe deposit, IRA, Keogh and other fiduciary, ATM and technology-based networks, and online and mobile banking services. In addition, it offers investment management, trust, estate advisory, and financial planning services, as well as business succession planning, and employee retirement planning services; investment strategy consulting and fiduciary services; and security brokerage services. Further, the company provides pay processing solutions, such as walk-in payment processing for payments delivered by customers to retail pay agents; online bill payment solutions for payments made by customers on a billing company's Website; customer service payments for payments accepted over the telephone; direct debit services; electronic concentration of payments delivered by the automated clearing house network; money management software and credit card networks; and lockbox remittance processing of payments delivered by mail. It has 28 banking centers in Illinois; 7 in southwest Florida; and 1 in Indianapolis, Indiana. First Busey Corporation was founded in 1868 and is headquartered in Champaign, Illinois.

Popular Company Profile

Popular, Inc., through its subsidiaries, provides various retail, mortgage, and commercial banking products and services primarily to institutional and retail customers. The company accepts various deposit products. It also offers commercial and industrial loans; commercial real estate loans; residential mortgage loans; consumer loans, including personal loans, credit cards, home equity lines of credit, and other loans to individual borrowers; construction loans; and lease financing comprising automobile loans/leases. In addition, the company provides financial advisory, investment banking, investment and securities brokerage, and insurance and reinsurance services. As of December 31, 2017, it owned and occupied approximately 67 branch premises and other facilities in Puerto Rico; and 62 offices comprising 6 owned and 56 leased in New York, New Jersey, and Florida. Popular, Inc. was founded in 1893 and is headquartered in Hato Rey, Puerto Rico.

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