Credicorp (NYSE: BAP) and Opus Bank (NASDAQ:OPB) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, profitability, dividends, institutional ownership, risk and earnings.
Volatility & Risk
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Credicorp has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, Opus Bank has a beta of 0.94, suggesting that its share price is 6% less volatile than the S&P 500.
This table compares Credicorp and Opus Bank’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
66.5% of Credicorp shares are held by institutional investors. Comparatively, 98.0% of Opus Bank shares are held by institutional investors. 15.9% of Credicorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Earnings & Valuation
This table compares Credicorp and Opus Bank’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Credicorp||$4.83 billion||3.76||$1.25 billion||$15.74||14.47|
|Opus Bank||$308.32 million||3.22||$46.89 million||$1.49||19.43|
Credicorp has higher revenue and earnings than Opus Bank. Credicorp is trading at a lower price-to-earnings ratio than Opus Bank, indicating that it is currently the more affordable of the two stocks.
Credicorp pays an annual dividend of $4.39 per share and has a dividend yield of 1.9%. Opus Bank pays an annual dividend of $0.44 per share and has a dividend yield of 1.5%. Credicorp pays out 27.9% of its earnings in the form of a dividend. Opus Bank pays out 29.5% 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. Credicorp has raised its dividend for 3 consecutive years. Credicorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a summary of current recommendations and price targets for Credicorp and Opus Bank, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Credicorp presently has a consensus target price of $233.50, suggesting a potential upside of 2.54%. Opus Bank has a consensus target price of $30.75, suggesting a potential upside of 6.22%. Given Opus Bank’s higher probable upside, analysts clearly believe Opus Bank is more favorable than Credicorp.
Credicorp beats Opus Bank on 13 of the 17 factors compared between the two stocks.
Credicorp Ltd., through its banking and non-banking subsidiaries, provides a range of financial, insurance, and health services and products primarily in Peru and internationally. It operates through four segments: Banking, Insurance, Pension Funds, and Investment Banking. The company offers deposits, current accounts, loans, and credit facilities; and provides private pension fund management services to affiliated pensioners. It also issues insurance policies to cover losses in commercial property, transportation, marine vessels, automobile, life, health, and pension funds. In addition, the company offers investment brokerage and management services to corporations, institutional investors, governments, and foundations; and engages in structuring and placement of issues in the primary market, as well as the execution and negotiation of operations in the secondary market. Further, it structures securitization processes for companies; and manages mutual funds. Credicorp Ltd. was incorporated in 1995 and is based in Hamilton, Bermuda.
About Opus Bank
Opus Bank provides various banking products, services, and solutions for small to mid-sized companies, entrepreneurs, real estate investors, professionals, and high net worth individuals. It offers demand deposits, checking accounts, money market accounts, savings accounts, and certificates of deposit. The company also provides multifamily residential loans, commercial real estate loans, commercial business loans, small business administration loans, construction loans, and single-family residential and consumer loans; and loans and lines for working capital, expansion, acquisitions, consolidation, and transition. In addition, it offers financial and advisory services related to raising equity capital, targeted acquisition and divestiture strategies, general mergers and acquisitions, debt and equity financing, balance sheet restructuring, valuation, strategy, and performance improvement. Further, the company provides commercial escrow services and facilitates tax-deferred commercial exchanges; financial and advisory services; and treasury, cash management, and depository solutions. As of March 5, 2018, it operated 50 banking offices, including 31 in California, 16 in the Seattle/Puget Sound region in Washington, 2 in the Phoenix metropolitan area of Arizona, and 1 in Portland, Oregon. The company was formerly known as Bay Cities National Bank. Opus Bank was founded in 1982 and is headquartered in Irvine, California.