Critical Contrast: ERSTE Grp Bk A/S (EBKDY) and Bancolombia (CIB)

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ERSTE Grp Bk A/S (OTCMKTS:EBKDY) and Bancolombia (NYSE:CIB) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, dividends, risk, analyst recommendations and earnings.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for ERSTE Grp Bk A/S and Bancolombia, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ERSTE Grp Bk A/S 0 0 0 0 N/A
Bancolombia 1 5 0 0 1.83

Bancolombia has a consensus price target of $41.00, suggesting a potential upside of 0.32%. Given Bancolombia’s higher possible upside, analysts plainly believe Bancolombia is more favorable than ERSTE Grp Bk A/S.

Dividends

ERSTE Grp Bk A/S pays an annual dividend of $0.68 per share and has a dividend yield of 3.6%. Bancolombia pays an annual dividend of $1.35 per share and has a dividend yield of 3.3%. ERSTE Grp Bk A/S pays out 41.0% of its earnings in the form of a dividend. Bancolombia pays out 37.1% 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.

Profitability

This table compares ERSTE Grp Bk A/S and Bancolombia’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ERSTE Grp Bk A/S 18.14% 8.38% 0.67%
Bancolombia 11.39% 8.42% 0.99%

Valuation and Earnings

This table compares ERSTE Grp Bk A/S and Bancolombia’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ERSTE Grp Bk A/S $9.04 billion 1.78 $1.49 billion $1.66 11.27
Bancolombia $5.76 billion 1.71 $784.50 million $3.64 11.23

ERSTE Grp Bk A/S has higher revenue and earnings than Bancolombia. Bancolombia is trading at a lower price-to-earnings ratio than ERSTE Grp Bk A/S, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

0.4% of ERSTE Grp Bk A/S shares are held by institutional investors. Comparatively, 7.7% of Bancolombia shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

ERSTE Grp Bk A/S has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500. Comparatively, Bancolombia has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500.

Summary

ERSTE Grp Bk A/S beats Bancolombia on 7 of the 13 factors compared between the two stocks.

ERSTE Grp Bk A/S Company Profile

Erste Group Bank AG provides a range of banking and other financial services to the retail and corporate customers in Austria, Central and Eastern Europe, and internationally. The company operates through Retail, Corporates, Group Markets, Asset/Liability Management and Local Corporate Center, Savings Banks, Group Corporate Center, and Intragroup Elimination segments. It offers savings and current accounts, mortgage and consumer loans, working capital finance, accounts receivable purchasing, structured trade finance, and supply chain finance services; loan syndication services; letters of credit, guarantees, investment finance, acquisition and leveraged finance, commercial real estate finance, buyer's credit, and revolving export credit lines; liquidity management; and hedging and documentary collection services. The company also provides private banking, asset management, investment banking, securities and derivatives trading, portfolio management, project finance, foreign trade financing, corporate finance, capital market and money market, foreign exchange trading, and leasing and factoring services; phone, online, and mobile banking services; and leasing, insurance, investment, and building society products, as well as credit cards. In addition, it offers real estate development and lending; advisory services related to acquisition, divestment, and merger, as well as risk management; analysis services for stock, bond, and commodity markets; and custody and brokerage services. The company operates through 2,565 branches in seven countries. Erste Group Bank AG was founded in 1819 and is headquartered in Vienna, Austria.

Bancolombia Company Profile

Bancolombia S.A. provides various banking products and services to individual, corporate, and government customers in Colombia, Latin America, and the Caribbean region. The company operates in nine segments: Banking Colombia, Banking Panama, Banking El Salvador, Banking Guatemala, Trust, Investment Banking, Brokerage, Off Shore, and All Other. It offers checking and savings accounts, fixed term deposits, and investment products; trade financing, loans funded by domestic development banks, working capital loans, credit cards, personal and vehicle loans, payroll loans, overdrafts, and financing for industrial projects; mortgage banking and factoring services; and financial and operating leasing services. The company also provides capital market products, including futures, forwards, options, and swaps; and brokerage, investment advisory, and private banking services, including selling and distributing equities, futures, foreign currencies, fixed income securities, mutual funds, and structured products. In addition, it offers cash management services; foreign currency transaction services; and life, auto, commercial, and homeowner's insurance products. Further, the company provides investment banking services comprising project and acquisition finance, debt and equity capital markets, principal investments, merger and acquisition, restructurings, and structured corporate lending; trust and asset management services, such as money market accounts, mutual and pension funds, private equity funds, payment trust, custody, and corporate trust; digital banking and revolving credit facility services. Additionally, it is involved in transportation, real estate brokerage, maintenance and remodeling, advertising and marketing, and outsourcing activities. The company operates 1,153 branches, 10,349 banking correspondents, and 590 mobile service spots; 227 kiosks; and 5,630 automatic teller machines. Bancolombia S.A. was founded in 1945 and is headquartered in MedellĂ­n, Colombia.

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