Horizon Bancorp (NYSE: BBD) and Banco Bradesco (NYSE:BBD) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, valuation, profitability, dividends and institutional ownership.

Valuation and Earnings

This table compares Horizon Bancorp and Banco Bradesco’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Horizon Bancorp $161.62 million 4.69 $33.11 million $1.02 19.35
Banco Bradesco $46.46 billion 0.96 $4.59 billion $0.89 7.49

Banco Bradesco has higher revenue and earnings than Horizon Bancorp. Banco Bradesco is trading at a lower price-to-earnings ratio than Horizon Bancorp, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Horizon Bancorp has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500. Comparatively, Banco Bradesco has a beta of 1.86, indicating that its stock price is 86% more volatile than the S&P 500.

Dividends

Horizon Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 2.0%. Banco Bradesco pays an annual dividend of $0.05 per share and has a dividend yield of 0.7%. Horizon Bancorp pays out 39.2% of its earnings in the form of a dividend. Banco Bradesco pays out 5.6% 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. Horizon Bancorp has increased its dividend for 4 consecutive years and Banco Bradesco has increased its dividend for 4 consecutive years.

Analyst Ratings

This is a summary of current ratings for Horizon Bancorp and Banco Bradesco, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Horizon Bancorp 0 1 2 0 2.67
Banco Bradesco 0 0 4 0 3.00

Horizon Bancorp currently has a consensus price target of $22.33, suggesting a potential upside of 13.14%. Given Horizon Bancorp’s higher possible upside, equities research analysts clearly believe Horizon Bancorp is more favorable than Banco Bradesco.

Insider and Institutional Ownership

52.8% of Horizon Bancorp shares are owned by institutional investors. Comparatively, 3.2% of Banco Bradesco shares are owned by institutional investors. 4.6% of Horizon Bancorp shares are owned by 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.

Profitability

This table compares Horizon Bancorp and Banco Bradesco’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Horizon Bancorp 23.28% 10.03% 1.15%
Banco Bradesco 12.02% 17.06% 1.57%

Horizon Bancorp Company Profile

Horizon Bancorp, Inc. operates as the bank holding company for Horizon Bank that provides commercial and retail banking services. The company offers non-interest bearing and interest-bearing demand deposits, savings accounts, money market deposits, and time deposits. Its loan portfolio comprises commercial, financial, agricultural, and commercial tax-exempt loans; and real estate, mortgage warehouse, and consumer loans. The company also provides corporate and individual trust and agency, investment management, and real estate investment trust services; and sells various insurance products. It operates through a network of 62 full service offices in Northern and Central Indiana, as well as Southern, Central, and Great Lakes bay regions of Michigan. The company was founded in 1873 and is headquartered in Michigan City, Indiana.

Banco Bradesco Company Profile

Banco Bradesco S.A. provides banking and financial products and services to individuals, enterprises, and corporations and institutions. It operates through two segments, Banking; and Insurance, Pension Plans and Capitalization Bond. The company accepts checking and savings accounts, time deposits, interbank deposits from financial institutions, and accounts for salary purposes. Its loan products include personal and payroll-deductible, vehicle financing, and overdraft loans; housing loans; government-funded long-term loans; short-term loans, working capital loans, guaranteed checking accounts and corporate overdraft loans, financing for purchase and sale of goods and services, and investment lines for acquisition of assets and machinery, as well as discounting trade receivables, promissory notes, checks, credit card and supplier receivables, etc.; rural credit; and import and export financing. The company also offers credit cards; cash management solutions; services related to capital markets and investment banking activities, including project finance, mergers and acquisitions, structured operations, fixed income, and variable income; and life and personal accident, health, automobile, property/casualty, and liability insurance products; reinsurance products; pension plans; and capitalization bonds. In addition, it provides public authority, leasing, asset management and administration, intermediation and trading, international banking, foreign exchange, consortia, automatic teller machines, telephone, and Internet Banking services. The company operates through a network of 4,749 branches; 4,827 service centers and electronic in-company service centers; 35,590 active ATMs; 21,259 ATMs under the Banco24Horas brand; and 3 branches internationally. Banco Bradesco S.A. was founded in 1943 and is headquartered in Osasco, Brazil.

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