Central Pacific Financial (NYSE:CPF) & Commerce Bancshares (NASDAQ:CBSH) Head to Head Review

Commerce Bancshares (NASDAQ:CBSH) and Central Pacific Financial (NYSE:CPF) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, earnings, dividends, institutional ownership and profitability.

Dividends

Commerce Bancshares pays an annual dividend of $1.10 per share and has a dividend yield of 1.8%. Central Pacific Financial pays an annual dividend of $1.08 per share and has a dividend yield of 4.0%. Commerce Bancshares pays out 27.4% of its earnings in the form of a dividend. Central Pacific Financial pays out 54.8% 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. Commerce Bancshares has increased its dividend for 58 consecutive years.

Analyst Ratings

This is a summary of recent ratings for Commerce Bancshares and Central Pacific Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Commerce Bancshares	1	5	0	0	1.83
Central Pacific Financial	0	0	0	0	0.00

Commerce Bancshares presently has a consensus target price of $68.17, indicating a potential upside of 11.31%. Given Commerce Bancshares’ stronger consensus rating and higher probable upside, analysts clearly believe Commerce Bancshares is more favorable than Central Pacific Financial.

Risk and Volatility

Commerce Bancshares has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500. Comparatively, Central Pacific Financial has a beta of 1.17, suggesting that its stock price is 17% more volatile than the S&P 500.

Institutional & Insider Ownership

70.3% of Commerce Bancshares shares are held by institutional investors. Comparatively, 88.4% of Central Pacific Financial shares are held by institutional investors. 3.2% of Commerce Bancshares shares are held by company insiders. Comparatively, 2.7% of Central Pacific Financial shares are held 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.

Profitability

This table compares Commerce Bancshares and Central Pacific Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Commerce Bancshares	25.24%	16.31%	1.69%
Central Pacific Financial	15.49%	12.03%	0.85%

Earnings & Valuation

This table compares Commerce Bancshares and Central Pacific Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Commerce Bancshares	$1.66 billion	4.94	$526.33 million	$4.01	15.27
Central Pacific Financial	$246.11 million	2.96	$53.41 million	$1.97	13.64

Commerce Bancshares has higher revenue and earnings than Central Pacific Financial. Central Pacific Financial is trading at a lower price-to-earnings ratio than Commerce Bancshares, indicating that it is currently the more affordable of the two stocks.

Summary

Commerce Bancshares beats Central Pacific Financial on 13 of the 16 factors compared between the two stocks.

About Commerce Bancshares

Commerce Bancshares, Inc. operates as the bank holding company for Commerce Bank that provides retail, mortgage banking, corporate, investment, trust, and asset management products and services to individuals and businesses in the United States. It operates through three segments: Consumer, Commercial, and Wealth. The Consumer segment offers various banking products and services, including consumer deposits; consumer loans, such as automobile, motorcycle, marine, tractor/trailer, recreational vehicle, fixed rate and revolving home equity, and other consumer loans; patient health care financing; real estate loans; indirect and other consumer financing; retail branch network; personal mortgage banking; consumer installment lending; and consumer debit and credit bank cards. The Commercial segment provides corporate lending, leasing, international, merchant and commercial bank card, and securities safekeeping and bond accounting services; and business products, government deposits, and related commercial cash management services, as well as sells fixed income securities to correspondent banks, corporations, public institutions, municipalities, and individuals. The Wealth segment provides traditional trust and estate planning, advisory and discretionary investment portfolio management, and brokerage services, as well as private banking accounts. The company also offers private equity investment, securities brokerage, insurance agency, specialty lending, and leasing services, as well as online and mobile banking services. Commerce Bancshares, Inc. was founded in 1865 and is headquartered in Kansas City, Missouri.

About Central Pacific Financial

Central Pacific Financial Corp. operates as the bank holding company for Central Pacific Bank that provides a range of commercial banking products and services to businesses, professionals, and individuals in the United States. It offers various deposit products and services, including checking, savings and time deposits, cash management and digital banking, trust, and retail brokerage services, as well as money market accounts and certificates of deposit. The company also provides various lending activities, such as commercial, commercial and residential mortgage, home equity, and consumer loans; and other products and services comprising debit cards, internet and mobile banking, cash management services, full-service ATMs, safe deposit boxes, international banking services, night depository facilities, foreign exchange, and wire transfers. In addition, it offers wealth management products and services that include non-deposit investment products, annuities, insurance, investment management, asset custody and general consultation, and planning services. The company was founded in 1954 and is headquartered in Honolulu, Hawaii.