Analyzing Trustmark (NASDAQ:TRMK) & Royal Bank Of Canada (NYSE:RY)

Trustmark (NASDAQ:TRMK) and Royal Bank Of Canada (NYSE:RY) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.

Valuation & Earnings

This table compares Trustmark and Royal Bank Of Canada”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Trustmark	$1.12 billion	2.38	$224.13 million	$3.94	11.69
Royal Bank Of Canada	$98.11 billion	2.85	$14.54 billion	$11.43	17.67

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Trustmark and Royal Bank Of Canada, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Trustmark	0	4	1	1	2.50
Royal Bank Of Canada	0	5	7	1	2.69

Trustmark presently has a consensus price target of $47.38, suggesting a potential upside of 2.90%. Royal Bank Of Canada has a consensus price target of $225.00, suggesting a potential upside of 11.42%. Given Royal Bank Of Canada’s stronger consensus rating and higher probable upside, analysts clearly believe Royal Bank Of Canada is more favorable than Trustmark.

Dividends

Trustmark pays an annual dividend of $1.00 per share and has a dividend yield of 2.2%. Royal Bank Of Canada pays an annual dividend of $4.96 per share and has a dividend yield of 2.5%. Trustmark pays out 25.4% of its earnings in the form of a dividend. Royal Bank Of Canada pays out 43.4% 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. Trustmark has increased its dividend for 1 consecutive years and Royal Bank Of Canada has increased its dividend for 15 consecutive years. Royal Bank Of Canada is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

67.6% of Trustmark shares are owned by institutional investors. Comparatively, 45.3% of Royal Bank Of Canada shares are owned by institutional investors. 1.7% of Trustmark shares are owned 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.

Risk & Volatility

Trustmark has a beta of 0.64, indicating that its share price is 36% less volatile than the S&P 500. Comparatively, Royal Bank Of Canada has a beta of 0.79, indicating that its share price is 21% less volatile than the S&P 500.

Profitability

This table compares Trustmark and Royal Bank Of Canada’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Trustmark	20.75%	10.69%	1.20%
Royal Bank Of Canada	16.17%	17.79%	0.97%

Summary

Royal Bank Of Canada beats Trustmark on 12 of the 17 factors compared between the two stocks.

About Trustmark

Trustmark Corporation operates as the bank holding company for Trustmark National Bank that provides banking and other financial solutions to individuals and corporate institutions in the United States. The company operates through three segments: General Banking, Wealth Management, and Insurance. It offers checking, savings, and money market accounts; certificates of deposits and individual retirement accounts; financing for commercial and industrial projects, income-producing commercial real estate, owner-occupied real estate, and construction and land development; and installment and real estate loans, and lines of credit, as well as treasury management services. The company also provides mortgage banking services, including construction financing, production of conventional and government-insured mortgages, and secondary marketing and mortgage servicing. In addition, it provides wealth management and trust services, such as administration of personal trusts and estates; management of investment accounts for individuals, employee benefit plans, and charitable foundations; and corporate trust and institutional custody, securities brokerage, financial and estate planning, retirement plan, and investment management services. Further, the company offers business insurance products and services for medical professionals, construction, manufacturing, hospitality, real estate, and group life and health plans; and life and health insurance, and personal line policies for individual customers. Trustmark Corporation was founded in 1889 and is headquartered in Jackson, Mississippi.

About Royal Bank Of Canada

Royal Bank of Canada operates as a diversified financial service company worldwide. The company's Personal & Commercial Banking segment offers checking and savings accounts, home equity financing, personal lending, private banking, indirect lending, including auto financing, mutual funds and self-directed brokerage accounts, guaranteed investment certificates, credit cards, and payment products and solutions; and lending, leasing, deposit, investment, foreign exchange, cash management, auto dealer financing, trade products, and services to small and medium-sized commercial businesses. This segment offers financial products and services through branches, automated teller machines, and mobile sales network. Its Wealth Management segment provides a suite of wealth, investment, trust, banking, credit, and other advice-based solutions and strategies to high net worth and ultra-high net worth individuals, and institutional clients; asset management products to institutional and individual clients; and asset and investor services to financial institutions, asset managers, and asset owners. The company's Insurance segment offers life, health, home, auto, travel, wealth, annuities, property and casualty, and reinsurance advice and solutions; and business insurance services to individual, business, and group clients through its advice centers, RBC insurance stores, and mobile advisors; digital platforms; and independent brokers and partners. The company's Capital Markets segment offers advisory and origination, sales and trading, lending and financing, and transaction banking services to corporations, institutional clients, asset managers, private equity firms, and governments. The company was founded in 1864 and is headquartered in Toronto, Canada.