First United (NASDAQ:FUNC – Get Rating) and Shinhan Financial Group (NYSE:SHG – Get Rating) are both finance companies, but which is the best investment? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, earnings, profitability, institutional ownership and dividends.
Risk and Volatility
First United has a beta of 0.76, indicating that its stock price is 24% less volatile than the S&P 500. In comparison, Shinhan Financial Group has a beta of 0.73, indicating that its stock price is stock is 27% less volatile than the S&P 500.
First United pays an annual dividend of $0.60 per share and has a dividend yield of 3.3%. Shinhan Financial Group pays an annual dividend of $0.48 per share and has a dividend yield of 1.6%. First United pays 18.1% of its profits as a dividend. Shinhan Financial Group pays 7.4% of its profits as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings over the next few years. First United has increased its dividend for 1 consecutive years. First United is clearly the better dividend-paying stock, given its higher yield and longer track record of dividend growth.
This table compares the net margins, return on equity and return on assets of First United and Shinhan Financial Group.
|Net margins||Return on equity||return on assets|
|Shinhan Financial Group||20.66%||8.51%||0.65%|
This is a breakdown of recent ratings and recommendations for First United and Shinhan Financial Group, as reported by MarketBeat.com.
|Sales Ratings||Hold odds||Buy reviews||Strong buy odds||Rating|
|Shinhan Financial Group||0||0||0||0||N / A|
First United currently has a consensus target price of $28.00, indicating a potential upside of 56.08%. Given First United’s possible higher upside, analysts clearly believe that First United is more favorable than Shinhan Financial Group.
Valuation and benefits
This table compares the revenue, earnings per share (EPS) and valuation of First United and Shinhan Financial Group.
|Gross revenue||Price/sales ratio||Net revenue||Earnings per share||Price/earnings ratio|
|Premier uni||$78.18 million||1.52||$19.77 million||$3.32||5.40|
|Shinhan Financial Group||$14.57 billion||1.08||$3.62 billion||$6.48||4.75|
Shinhan Financial Group has higher revenue and profit than First United. Shinhan Financial Group trades at a lower price-to-earnings ratio than First United, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
29.1% of First United shares are held by institutional investors. By comparison, 7.6% of Shinhan Financial Group’s shares are held by institutional investors. 4.2% of First United’s stock is held by insiders of the company. By comparison, 1.0% of Shinhan Financial Group shares are held by insiders of the company. Strong institutional ownership indicates that hedge funds, endowments, and large fund managers believe a stock is poised for long-term growth.
First United beats Shinhan Financial Group on 12 out of 16 factors compared between the two stocks.
First United Company Profile (Get an evaluation)
First United Corporation operates as a bank holding company for First United Bank & Trust which provides various retail and commercial banking services to businesses and individuals. The Company offers a variety of deposit products, including checking accounts, savings and money market accounts, ordinary and individual retirement account (IRA) certificates of deposit, Christmas savings accounts, college savings and health savings accounts; deposit account certificate registry service program and insured fund scanning program for municipalities, businesses and consumers; and packages for business customers, which include cash management, cash sweeping, and various verification opportunities. It also makes loans, such as commercial loans secured by real estate, commercial equipment, vehicles or other assets of the borrower; commercial real estate loans for residential and commercial development, agricultural properties and service industry buildings; residential mortgages; home equity lines of credit; loans for the construction of residential real estate; and indirect and direct auto loans, student loans, term loans and other secured and unsecured lines of credit and term loans. In addition, the company offers a variety of trust services, including personal trusts, employment agency accounts, charitable trusts, retirement accounts comprised of IRA rollovers, 401(k) accounts and defined benefit plans, estate administration and estate planning services; insurance products; brokerage services; as well as safes and night deposits. It operates 26 banking offices, a customer service center and 34 ATMs in Allegany, Frederick, Garrett and Washington counties in Maryland; and in Mineral, Berkeley, Monongalia and Harrison counties in West Virginia. First United Corporation was founded in 1900 and is headquartered in Oakland, Maryland.
Shinhan Financial Group Company Profile (Get an evaluation)
Shinhan Financial Group Co., Ltd. provides financial products and services in South Korea and internationally. The Company operates through six segments: banking, credit card, securities, life insurance, credit and others. It offers retail banking services, including application, savings and taking fixed deposits; verify accounts; mortgages and home equity, and personal loans; electronic banking services and automated teller machines (ATMs); and bill payment, payroll and check cashing, currency exchange and funds transfer services. The Company also provides corporate banking services, such as investment banking, real estate finance, overseas real estate and development project finance, infrastructure and structured finance, venture capital investments, advice on mergers and acquisitions; securitization and derivatives services involving securities and derivatives, and foreign exchange transactions; and working capital loans and facility loans. In addition, it is involved in treasury and investment activities in international capital markets comprising trading in foreign currency denominated securities, trading and foreign exchange services, trade-related financial services, factoring services international and foreign banking operations. In addition, the Company offers trust account management, securities brokerage and asset management services, as well as equipment leasing and financing, savings banking, collections lending and credit reporting, collective investment scheme administration, private equity investment and financial systems development. As of December 31, 2021, it operates a network of 784 service centers; 5,234 ATMs; 7 ATMs; and 85 digital kiosks. Shinhan Financial Group Co., Ltd. was founded in 1982 and is headquartered in Seoul, South Korea.
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