Head to Head Comparison: CVB Financial (NASDAQ:CVBF) & Hanmi Financial (NASDAQ:HAFC)

CVB Financial (NASDAQ:CVBF) and Hanmi Financial (NASDAQ:HAFC) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, analyst recommendations, risk, valuation, institutional ownership and earnings.

Earnings and Valuation

This table compares CVB Financial and Hanmi Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CVB Financial	$648.47 million	4.11	$209.30 million	$1.50	13.08
Hanmi Financial	$444.90 million	1.76	$76.09 million	$2.51	10.41

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

Profitability

This table compares CVB Financial and Hanmi Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CVB Financial	32.28%	9.30%	1.36%
Hanmi Financial	17.10%	9.85%	0.97%

Dividends

CVB Financial pays an annual dividend of $0.80 per share and has a dividend yield of 4.1%. Hanmi Financial pays an annual dividend of $1.12 per share and has a dividend yield of 4.3%. CVB Financial pays out 53.3% of its earnings in the form of a dividend. Hanmi Financial pays out 44.6% 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. Hanmi Financial has raised its dividend for 1 consecutive years. Hanmi Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent recommendations for CVB Financial and Hanmi Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CVB Financial	0	2	2	0	2.50
Hanmi Financial	0	3	2	0	2.40

CVB Financial currently has a consensus price target of $24.17, suggesting a potential upside of 23.17%. Hanmi Financial has a consensus price target of $31.33, suggesting a potential upside of 19.96%. Given CVB Financial’s stronger consensus rating and higher possible upside, equities research analysts clearly believe CVB Financial is more favorable than Hanmi Financial.

Volatility & Risk

CVB Financial has a beta of 0.68, meaning that its stock price is 32% less volatile than the S&P 500. Comparatively, Hanmi Financial has a beta of 0.77, meaning that its stock price is 23% less volatile than the S&P 500.

Institutional & Insider Ownership

74.2% of CVB Financial shares are held by institutional investors. Comparatively, 88.7% of Hanmi Financial shares are held by institutional investors. 6.1% of CVB Financial shares are held by company insiders. Comparatively, 1.6% of Hanmi Financial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

CVB Financial beats Hanmi Financial on 9 of the 16 factors compared between the two stocks.

About CVB Financial

CVB Financial Corp. operates as a bank holding company for Citizens Business Bank, a state-chartered bank that provides banking and financial services to small to mid-sized businesses and individuals. It offers checking, savings, money market, and time certificates of deposit products for business and personal accounts; and serves as a federal tax depository for business customers. The company also provides commercial lending products comprising lines of credit and other working capital financing, accounts receivable lending, and letters of credit; agriculture loans to finance the operating needs of wholesale dairy farm operations, cattle feeders, livestock raisers, and farmers; lease financing services for municipal governments; commercial real estate and construction loans; and consumer financing products, including automobile leasing and financing, lines of credit, credit cards, home mortgages, and home equity loans and lines of credit. In addition, it offers various specialized services, such as treasury management systems for monitoring cash flow, merchant card processing program, armored pick-up and delivery, payroll services, remote deposit capture, electronic funds transfers, wires and automated clearinghouse, and online account access. Further, the company provides trust services, such as fiduciary services, mutual funds, annuities, 401(k) plans, and individual investment accounts. CVB Financial Corp. was founded in 1974 and is headquartered in Ontario, California.

About Hanmi Financial

Hanmi Financial Corporation operates as the holding company for Hanmi Bank that provides business banking products and services in the United States. It offers various deposit products, including noninterest-bearing checking accounts, savings accounts, negotiable order of withdrawal accounts, money market accounts, and certificates of deposit. The company also provides real estate loans, such as commercial property, construction, and residential property loans; and commercial and industrial loans, such as commercial term loans and commercial lines of credit; and international finance and trade services and products, such as letters of credit, and import and export financing. In addition, it offers small business administration loans for business purposes, which comprise owner-occupied commercial real estate, business acquisitions, start-ups, franchise financing, working capital, improvements and renovations, inventory and equipment, and debt-refinancing, as well as equipment lease financing. The company was founded in 1982 and is headquartered in Los Angeles, California.