Wells Fargo & Co (NYSE:WFC) and Green Bancorp (NYSE:GNBC) Head-To-Head Comparison

Wells Fargo & Co (NYSE:WFC) and Green Bancorp (NASDAQ:GNBC) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, analyst recommendations, valuation and dividends.

Analyst Recommendations

This is a summary of current ratings for Wells Fargo & Co and Green Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Wells Fargo & Co 1 12 7 0 2.30
Green Bancorp 0 1 2 0 2.67

Wells Fargo & Co presently has a consensus price target of $54.91, indicating a potential upside of 16.04%. Green Bancorp has a consensus price target of $29.00, indicating a potential upside of 69.19%. Given Green Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Green Bancorp is more favorable than Wells Fargo & Co.

Dividends

Wells Fargo & Co pays an annual dividend of $1.80 per share and has a dividend yield of 3.8%. Green Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.3%. Wells Fargo & Co pays out 41.1% of its earnings in the form of a dividend. Green Bancorp pays out 33.1% 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. Wells Fargo & Co has increased its dividend for 7 consecutive years. Wells Fargo & Co is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Wells Fargo & Co and Green Bancorp’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Wells Fargo & Co $101.06 billion 2.10 $22.39 billion $4.38 10.80
Green Bancorp $190.76 million 3.36 $34.13 million $1.21 14.17

Wells Fargo & Co has higher revenue and earnings than Green Bancorp. Wells Fargo & Co is trading at a lower price-to-earnings ratio than Green Bancorp, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Wells Fargo & Co and Green Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Wells Fargo & Co 22.59% 13.37% 1.25%
Green Bancorp 20.51% 12.15% 1.34%

Risk & Volatility

Wells Fargo & Co has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500. Comparatively, Green Bancorp has a beta of 2.05, meaning that its share price is 105% more volatile than the S&P 500.

Insider and Institutional Ownership

75.4% of Wells Fargo & Co shares are held by institutional investors. Comparatively, 68.3% of Green Bancorp shares are held by institutional investors. 0.1% of Wells Fargo & Co shares are held by insiders. Comparatively, 14.0% of Green Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Wells Fargo & Co beats Green Bancorp on 9 of the 17 factors compared between the two stocks.

Wells Fargo & Co Company Profile

Wells Fargo & Company, a diversified financial services company, provides retail, commercial, and corporate banking services to individuals, businesses, and institutions. It operates through three segments: Community Banking, Wholesale Banking, and Wealth and Investment Management. The company also engages in the wholesale banking, mortgage banking, consumer finance, equipment leasing, agricultural finance, commercial finance, securities brokerage and investment banking, computer and data processing, trust, investment advisory, mortgage-backed securities, and venture capital investment services. As of February 7, 2019, it operated through 7,800 locations, 13,000 ATMs, and the Internet and mobile banking, as well as has offices in 37 countries and territories. Wells Fargo & Company was founded in 1852 and is headquartered in San Francisco, California.

Green Bancorp Company Profile

Green Bancorp, Inc. operates as the bank holding company for Green Bank, N.A. that provides commercial and private banking services primarily in Texas. It offers deposit accounts, such as demand, savings, money market, and time accounts. The company also provides loans, including commercial and industrial loans, including commercial lines of credit, working capital loans, commercial real estate-backed loans, mortgage-warehouse lines, term loans, equipment financing, borrowing base loans, real estate construction loans, homebuilder loans, government guaranteed loans, purchased receivables financing, letters of credit, and other loan products, as well as acquisition, expansion, and development loans to national and regional companies, real estate developers, mortgage lenders, manufacturing and industrial companies, and other businesses. In addition, it offers various consumer loans, such as residential real estate loans, home equity loans, installment loans, unsecured and secured personal lines of credit, overdraft protection, and letters of credit. Further, the company provides a range of online banking solutions, including access to account balances, online transfers, online bill payment, and electronic delivery of customer statements; and extended drive-through hours, and ATMs, as well as banking through telephone, mail, and personal appointment. Additionally, it offers debit cards, night depository services, direct deposits, and cashier's checks, as well as treasury management, wire transfer, and automated clearing house services. The company provides its services through 22 full service branches in the greater Houston and Dallas metropolitan areas, as well as in Austin, Louisville, and Honey Grove. Green Bancorp, Inc. was founded in 1999 and is headquartered in Houston, Texas.

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