Contrasting Wells Fargo & Company (NYSE:WFC) and Solera National Bancorp (OTCMKTS:SLRK)

Wells Fargo & Company (NYSE:WFC) and Solera National Bancorp (OTCMKTS:SLRK) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, earnings, analyst recommendations, institutional ownership, valuation, dividends and profitability.

Analyst Ratings

This is a summary of current ratings and price targets for Wells Fargo & Company and Solera National Bancorp, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wells Fargo & Company	0	11	6	1	2.44
Solera National Bancorp	0	0	0	0	N/A

Wells Fargo & Company presently has a consensus target price of $55.85, indicating a potential downside of 3.64%. Given Wells Fargo & Company’s higher probable upside, analysts clearly believe Wells Fargo & Company is more favorable than Solera National Bancorp.

Profitability

This table compares Wells Fargo & Company and Solera National Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Wells Fargo & Company	16.60%	12.40%	1.07%
Solera National Bancorp	25.55%	N/A	N/A

Volatility & Risk

Wells Fargo & Company has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500. Comparatively, Solera National Bancorp has a beta of 0.53, meaning that its stock price is 47% less volatile than the S&P 500.

Insider and Institutional Ownership

75.9% of Wells Fargo & Company shares are owned by institutional investors. 0.1% of Wells Fargo & Company shares are owned by insiders. Comparatively, 17.4% of Solera National Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Wells Fargo & Company and Solera National Bancorp’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wells Fargo & Company	$115.34 billion	1.78	$19.14 billion	$4.82	12.02
Solera National Bancorp	$65.19 million	0.64	$16.66 million	$3.80	2.57

Wells Fargo & Company has higher revenue and earnings than Solera National Bancorp. Solera National Bancorp is trading at a lower price-to-earnings ratio than Wells Fargo & Company, indicating that it is currently the more affordable of the two stocks.

Summary

Wells Fargo & Company beats Solera National Bancorp on 12 of the 14 factors compared between the two stocks.

About Wells Fargo & Company

Wells Fargo & Company, a financial services company, provides diversified banking, investment, mortgage, and consumer and commercial finance products and services in the United States and internationally. The company operates through four segments: Consumer Banking and Lending; Commercial Banking; Corporate and Investment Banking; and Wealth and Investment Management. The Consumer Banking and Lending segment offers diversified financial products and services for consumers and small businesses. Its financial products and services include checking and savings accounts, and credit and debit cards, as well as home, auto, personal, and small business lending services. The Commercial Banking segment provides financial solutions to private, family owned, and certain public companies. Its products and services include banking and credit products across various industry sectors and municipalities, secured lending and lease products, and treasury management services. The Corporate and Investment Banking segment offers a suite of capital markets, banking, and financial products and services, such as corporate banking, investment banking, treasury management, commercial real estate lending and servicing, equity, and fixed income solutions, as well as sales, trading, and research capabilities services to corporate, commercial real estate, government, and institutional clients. The Wealth and Investment Management segment provides personalized wealth management, brokerage, financial planning, lending, private banking, and trust and fiduciary products and services to affluent, high-net worth, and ultra-high-net worth clients. It also operates through financial advisors in brokerage and wealth offices, consumer bank branches, independent offices, and digitally through WellsTrade and Intuitive Investor. The company was founded in 1852 and is headquartered in San Francisco, California.

About Solera National Bancorp

Solera National Bancorp, Inc. operates as the bank holding company for Solera National Bank that provides commercial and consumer banking services to small and medium-sized businesses, licensed professionals, and individuals in the United States. The company offers deposit products, including checking and savings accounts, money market accounts, time and demand deposits, and certificates of deposit; and business loan products, such as real estate secured loans, construction loans, small business administration loans, business lines of credit, and equipment financing. It also provides online banking, account analysis, combined account analysis, commercial sweep, remote deposit, ACH origination, payroll direct deposit, merchant, fraud, business debit card, and cash management services. The company was incorporated in 2005 and is headquartered in Lakewood, Colorado.