QCR (NASDAQ:QCRH) and China Merchants Bank (OTCMKTS:CIHKY) Head to Head Analysis

QCR (NASDAQ:QCRH) and China Merchants Bank (OTCMKTS:CIHKY) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their risk, institutional ownership, earnings, dividends, valuation, analyst recommendations and profitability.

Dividends

QCR pays an annual dividend of $0.60 per share and has a dividend yield of 0.6%. China Merchants Bank pays an annual dividend of $1.18 per share and has a dividend yield of 3.5%. QCR pays out 7.1% of its earnings in the form of a dividend. China Merchants Bank pays out 28.4% 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.

Volatility and Risk

QCR has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500. Comparatively, China Merchants Bank has a beta of 0.18, suggesting that its stock price is 82% less volatile than the S&P 500.

Institutional & Insider Ownership

70.0% of QCR shares are held by institutional investors. 3.2% of QCR shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares QCR and China Merchants Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
QCR	22.86%	12.87%	1.50%
China Merchants Bank	32.69%	12.45%	1.23%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for QCR and China Merchants Bank, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QCR	0	3	4	0	2.57
China Merchants Bank	0	1	0	0	2.00

QCR presently has a consensus target price of $110.60, suggesting a potential upside of 12.57%. Given QCR’s stronger consensus rating and higher probable upside, research analysts plainly believe QCR is more favorable than China Merchants Bank.

Valuation and Earnings

This table compares QCR and China Merchants Bank”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
QCR	$387.04 million	4.16	$127.19 million	$8.46	11.61
China Merchants Bank	$65.04 billion	2.65	$20.89 billion	$4.15	8.24

China Merchants Bank has higher revenue and earnings than QCR. China Merchants Bank is trading at a lower price-to-earnings ratio than QCR, indicating that it is currently the more affordable of the two stocks.

Summary

QCR beats China Merchants Bank on 12 of the 16 factors compared between the two stocks.

About QCR

QCR Holdings, Inc., a multi-bank holding company, provides commercial and consumer banking, and trust and asset management services. The company’s deposit products include noninterest-bearing demand, interest-bearing demand, time, and brokered deposits. It also provides various commercial and retail lending/leasing, and investment services to corporations, partnerships, individuals, and government agencies. The company’s loan portfolio comprises loans to small and mid-sized businesses; business loans, including lines of credit for working capital and operational purposes; term loans for the acquisition of facilities, equipment, and other purposes; commercial and residential real estate loans; and installment and other consumer loans, such as home improvement, home equity, motor vehicle, and signature loans, as well as small personal credit lines. In addition, it engages in leasing of machinery and equipment to commercial and industrial businesses under direct financing lease contracts; and issuance of trust preferred securities. QCR Holdings, Inc. was incorporated in 1993 and is headquartered in Moline, Illinois.

About China Merchants Bank

China Merchants Bank Co., Ltd., together with its subsidiaries, provides various banking products and services. It operates through Wholesale Finance Business, Retail Finance Business, and Other Business segments. The company offers current, demand, time, call, savings, notice, and renminbi accounts. Its loan products include personal commercial real estate, consumption, housing, and car loans; loans to finance for studying abroad; micro-business loans; mortgage loans for equipment; joint guarantee, special guarantee, and housing mortgage loan; bank acceptance, discount, liquid capital, and fixed asset loans; and loans for vessels. The company also offers credit cards; insurance products; open-ended funds; discount and guarantees for commercial bills, redemption of commercial bills, and guaranteed discount for commercial acceptance bills; and financial consultation, debt financing underwriting, merger and acquisition financing, and equity financing and enterprise listing services. In addition, it provides forfeiting and risk participation, escrow, cross-border RMB clearing, and interbank services; and risk and financial management, cross-border RMB and oversea financing, international factoring and settlement, and trade finance services. Further, the company offers financial leasing and guarantee, investment and wealth management, forex option and gold trading, forex express trading, international, offshore and private banking, custody, pension, and electronic banking services. The company also operates in Hong Kong, New York, London, Singapore, Luxembourg, Sydney, and Taipei. China Merchants Bank Co., Ltd. was founded in 1987 and is headquartered in Shenzhen, China.