UMB Financial (NASDAQ:UMBF) versus Peapack-Gladstone Financial (NASDAQ:PGC) Head-To-Head Review

Peapack-Gladstone Financial (NASDAQ:PGC) and UMB Financial (NASDAQ:UMBF) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, profitability, earnings and analyst recommendations.

Profitability

This table compares Peapack-Gladstone Financial and UMB Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Peapack-Gladstone Financial	11.09%	7.82%	0.68%
UMB Financial	21.64%	13.41%	1.38%

Valuation & Earnings

This table compares Peapack-Gladstone Financial and UMB Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Peapack-Gladstone Financial	$444.61 million	1.71	$37.33 million	$2.88	14.87
UMB Financial	$4.14 billion	2.38	$702.40 million	$12.01	10.80

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

Analyst Recommendations

This is a breakdown of current ratings for Peapack-Gladstone Financial and UMB Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Peapack-Gladstone Financial	0	1	3	1	3.00
UMB Financial	0	4	11	1	2.81

Peapack-Gladstone Financial currently has a consensus target price of $56.33, indicating a potential upside of 31.56%. UMB Financial has a consensus target price of $163.86, indicating a potential upside of 26.38%. Given Peapack-Gladstone Financial’s stronger consensus rating and higher probable upside, analysts plainly believe Peapack-Gladstone Financial is more favorable than UMB Financial.

Volatility & Risk

Peapack-Gladstone Financial has a beta of 0.72, suggesting that its share price is 28% less volatile than the S&P 500. Comparatively, UMB Financial has a beta of 0.82, suggesting that its share price is 18% less volatile than the S&P 500.

Dividends

Peapack-Gladstone Financial pays an annual dividend of $0.20 per share and has a dividend yield of 0.5%. UMB Financial pays an annual dividend of $2.00 per share and has a dividend yield of 1.5%. Peapack-Gladstone Financial pays out 6.9% of its earnings in the form of a dividend. UMB Financial pays out 16.7% 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. UMB Financial has increased its dividend for 32 consecutive years. UMB Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

72.8% of Peapack-Gladstone Financial shares are held by institutional investors. Comparatively, 87.8% of UMB Financial shares are held by institutional investors. 5.8% of Peapack-Gladstone Financial shares are held by insiders. Comparatively, 5.3% of UMB Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

UMB Financial beats Peapack-Gladstone Financial on 12 of the 17 factors compared between the two stocks.

About Peapack-Gladstone Financial

Peapack-Gladstone Financial Corporation operates as the bank holding company for Peapack-Gladstone Bank that provides private banking and wealth management services in the United States. The company operates in two segments, Banking and Peapack Private. It offers checking and savings accounts, money market and interest-bearing checking accounts, certificates of deposit, and individual retirement accounts. The company also provides working capital lines of credit, term loans for fixed asset acquisitions, commercial mortgages, multi-family mortgages, and other forms of asset-based financing services; and residential mortgages, home equity lines of credit, and other second mortgage loans. In addition, it offers corporate and industrial (C&I) and equipment finance, commercial real estate, multifamily, residential, and consumer lending activities; treasury management services; C&I advisory services; escrow management; deposit generation; investment management services; personal trust services, including services as executor, trustee, administrator, custodian, and guardian; and other financial planning, tax preparation, and advisory services. Further, the company provides telephone and Internet banking, merchant credit card, and customer support sales services. Its private banking clients include businesses, non-profits, and consumers; wealth management clients comprise individuals, families, foundations, endowments, trusts, and estates; and commercial loan clients include business owners, professionals, retailers, contractors, and real estate investors. The company operates its private banking locations in Bedminster, Morristown, Princeton, and Teaneck, New Jersey; and branches in Somerset, Morris, Hunterdon, and Union counties, as well as operates automated teller machines. Peapack-Gladstone Financial Corporation was founded in 1921 and is headquartered in Bedminster, New Jersey.

About UMB Financial

UMB Financial Corporation operates as the bank holding company that provides banking services and asset servicing in the United States and internationally. The Commercial Banking segment provides commercial loans and credit card; commercial real estate financing; letters of credit; loan syndication, and consultative service; various business solutions including asset-based lending, mezzanine debt, and minority equity investment; and treasury management service, such as depository service, account reconciliation, cash management tool, accounts payable and receivable solution, electronic fund transfer and automated payment, controlled disbursement, lockbox service, and remote deposit capture service. The Institutional Banking segment offers fund, asset management, and healthcare service to institutional clients; and fund administration and accounting, investor service and transfer agency, mutual fund service, alternative investment service, fixed income sale, trading and underwriting, and corporate trust and escrow service, as well as institutional custody service. This segment also provides healthcare payment solution includes custodial service for health saving accounts and private label, multipurpose debit cards to insurance carriers, third-party administrator, software companies, employers, and financial institutions. The Personal Banking segment offers deposit account, retail credit card, private banking, installment loan, home equity line of credit, residential mortgage, as well as internet banking, ATM network, private banking, brokerage and insurance service, and investment advisory, custody, and trust services. It operates through a network of branches and offices. The company was founded in 1913 and is headquartered in Kansas City, Missouri.