Contrasting Commerzbank (OTCMKTS:CRZBY) & Home BancShares (NYSE:HOMB)

Commerzbank (OTCMKTS:CRZBY) and Home BancShares (NYSE:HOMB) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, institutional ownership, risk, earnings, profitability, valuation and analyst recommendations.

Earnings and Valuation

This table compares Commerzbank and Home BancShares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Commerzbank	$26.54 billion	1.92	$2.97 billion	$3.04	15.94
Home BancShares	$1.48 billion	3.95	$475.44 million	$2.42	12.06

Commerzbank has higher revenue and earnings than Home BancShares. Home BancShares is trading at a lower price-to-earnings ratio than Commerzbank, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Commerzbank has a beta of 0.56, suggesting that its stock price is 44% less volatile than the S&P 500. Comparatively, Home BancShares has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Commerzbank and Home BancShares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Commerzbank	0	3	5	1	2.78
Home BancShares	0	4	5	0	2.56

Home BancShares has a consensus price target of $33.00, indicating a potential upside of 13.07%. Given Home BancShares’ higher possible upside, analysts clearly believe Home BancShares is more favorable than Commerzbank.

Profitability

This table compares Commerzbank and Home BancShares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Commerzbank	13.30%	8.89%	0.53%
Home BancShares	32.10%	11.12%	2.07%

Institutional & Insider Ownership

67.3% of Home BancShares shares are owned by institutional investors. 6.4% of Home BancShares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Commerzbank pays an annual dividend of $0.90 per share and has a dividend yield of 1.9%. Home BancShares pays an annual dividend of $0.92 per share and has a dividend yield of 3.2%. Commerzbank pays out 29.6% of its earnings in the form of a dividend. Home BancShares pays out 38.0% 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. Home BancShares has raised its dividend for 15 consecutive years. Home BancShares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Home BancShares beats Commerzbank on 10 of the 17 factors compared between the two stocks.

About Commerzbank

Commerzbank AG provides banking and capital market products and services to private and small business customers, corporate, financial service providers, and institutional clients in Germany, rest of Europe, the Americas, Asia, and internationally. It operates through two segments, Private and Small-Business Customers, and Corporate Clients. The company offers saving, checking, business, and current accounts; term deposits; pension; credit and debit cards; payment solutions; overdraft services; various loans; and insurance products. It also provides trade securities; treasury management; corporate financing; real estate financing; financing advisory; merger and acquisition; foreign trade; trade financing; asset and risk management; and online banking, as well as wealth management services. Commerzbank AG was founded in 1870 and is headquartered in Frankfurt am Main, Germany.

About Home BancShares

Home Bancshares, Inc. (Conway, AR) operates as the bank holding company for Centennial Bank that provides commercial and retail banking, and related financial services to businesses, real estate developers and investors, individuals, and municipalities. Its deposit products include checking, savings, and money market accounts, as well as certificates of deposit. The company's loan portfolio comprises non-farm/non-residential real estate, construction/land development, residential mortgage, consumer, agricultural, and commercial and industrial loans. It provides internet banking, mobile banking and voice response information, cash management, overdraft protection, direct deposit, and automatic account transfer services, as well as safe deposit boxes and the United States savings bonds. In addition, the company writes policies for commercial and personal lines of business, including insurance for property, casualty, life, health, and employee benefits. It operates through branches in Arkansas, Florida, Alabama, Texas, and New York City. Home Bancshares, Inc. (Conway, AR) was founded in 1998 and is headquartered in Conway, Arkansas.