Critical Survey: Pinnacle Financial Partners (PNFP) versus Its Peers

Pinnacle Financial Partners (NYSE:PNFP) is one of 920 publicly-traded companies in the “Banks” industry, but how does it weigh in compared to its competitors? We will compare Pinnacle Financial Partners to similar companies based on the strength of its profitability, analyst recommendations, earnings, valuation, institutional ownership, dividends and risk.

Risk & Volatility

Pinnacle Financial Partners has a beta of 1.03, indicating that its stock price is 3% more volatile than the S&P 500. Comparatively, Pinnacle Financial Partners’ competitors have a beta of 0.60, indicating that their average stock price is 40% less volatile than the S&P 500.

Institutional and Insider Ownership

87.4% of Pinnacle Financial Partners shares are held by institutional investors. Comparatively, 47.9% of shares of all “Banks” companies are held by institutional investors. 1.3% of Pinnacle Financial Partners shares are held by company insiders. Comparatively, 9.8% of shares of all “Banks” companies are held by company 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.

Earnings & Valuation

This table compares Pinnacle Financial Partners and its competitors revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Pinnacle Financial Partners	$3.32 billion	$641.86 million	13.56
Pinnacle Financial Partners Competitors	$37.78 billion	$2.41 billion	19.02

Pinnacle Financial Partners’ competitors have higher revenue and earnings than Pinnacle Financial Partners. Pinnacle Financial Partners is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Dividends

Pinnacle Financial Partners pays an annual dividend of $2.00 per share and has a dividend yield of 2.0%. Pinnacle Financial Partners pays out 26.7% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 9.5% and pay out 28.9% of their earnings in the form of a dividend. Pinnacle Financial Partners has increased its dividend for 1 consecutive years.

Analyst Recommendations

This is a summary of current recommendations and price targets for Pinnacle Financial Partners and its competitors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pinnacle Financial Partners	0	3	17	1	2.90
Pinnacle Financial Partners Competitors	7449	30142	27691	1450	2.35

Pinnacle Financial Partners presently has a consensus target price of $120.15, suggesting a potential upside of 18.26%. As a group, “Banks” companies have a potential upside of 17.34%. Given Pinnacle Financial Partners’ stronger consensus rating and higher probable upside, analysts plainly believe Pinnacle Financial Partners is more favorable than its competitors.

Profitability

This table compares Pinnacle Financial Partners and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pinnacle Financial Partners	15.97%	11.33%	1.25%
Pinnacle Financial Partners Competitors	15.48%	9.50%	0.93%

Summary

Pinnacle Financial Partners beats its competitors on 10 of the 15 factors compared.

Pinnacle Financial Partners Company Profile

Pinnacle Financial Partners, Inc. operates as the bank holding company for Pinnacle Bank that provides various banking products and services to individuals, businesses, and professional entities in the United States. It accepts various deposits, including savings, noninterest-bearing and interest-bearing checking, money market, and certificate of deposit accounts; and provides treasury management services, such as online wire origination, enhanced ACH origination, positive pay, zero balance and sweep accounts, automated bill pay services, electronic receivables processing, lockbox processing, and merchant card acceptance services, small business and commercial credit cards corporate purchasing cards, and virtual accounting/deposit escrow solutions. The company also offers equipment and working capital loan; commercial real estate loans, such as investment properties and business loan; secured and unsecured loans comprising installment and term, lines of credit, and residential first mortgage, as well as home equity loans and home equity lines of credit; and credit cards for consumers and businesses. In addition, the company provides investment products; brokerage and investment advisory programs; and fiduciary and investment services, including personal trust, investment management, estate administration, endowments, foundations, individual retirement accounts, escrow services, and custody. Further, it offers insurance agency services in the property and casualty area; investment, merger and acquisition advisory services, private debt, equity and mezzanine, and other middle-market advisory services; and other banking services, including telephone and online banking, mobile banking, debit cards, direct deposit and remote deposit capture, mobile deposit option, automated teller machine, and cash management services. Pinnacle Financial Partners, Inc. was incorporated in 2000 and is headquartered in Nashville, Tennessee.