Analyzing Columbia Financial (NASDAQ:CLBK) & Bank of Communications (OTCMKTS:BCMXY)

Bank of Communications (OTCMKTS:BCMXY) and Columbia Financial (NASDAQ:CLBK) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, profitability, earnings, analyst recommendations and risk.

Dividends

Bank of Communications pays an annual dividend of $0.97 per share and has a dividend yield of 3.7%. Columbia Financial pays an annual dividend of $0.20 per share and has a dividend yield of 1.8%. Bank of Communications pays out 26.9% of its earnings in the form of a dividend. Columbia Financial pays out 58.8% 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. Bank of Communications is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares Bank of Communications and Columbia Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank of Communications	$71.22 billion	1.10	$13.30 billion	$3.61	7.29
Columbia Financial	$508.02 million	6.01	$51.77 million	$0.34	33.32

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

Profitability

This table compares Bank of Communications and Columbia Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank of Communications	19.23%	7.91%	0.64%
Columbia Financial	11.19%	5.29%	0.56%

Institutional and Insider Ownership

12.7% of Columbia Financial shares are held by institutional investors. 3.5% of Columbia Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Risk and Volatility

Bank of Communications has a beta of -0.03, meaning that its stock price is 103% less volatile than the S&P 500. Comparatively, Columbia Financial has a beta of 0.24, meaning that its stock price is 76% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for Bank of Communications and Columbia Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank of Communications	0	1	0	0	2.00
Columbia Financial	0	1	3	0	2.75

Columbia Financial has a consensus target price of $15.10, indicating a potential upside of 33.27%. Given Columbia Financial’s stronger consensus rating and higher probable upside, analysts plainly believe Columbia Financial is more favorable than Bank of Communications.

About Bank of Communications

Bank of Communications Co., Ltd. provides commercial banking products and services in China. The company offers savings deposit products, including demand deposits, lump-sum deposits and withdrawal, time deposit of small savings for lump-sum withdrawal, interest withdrawal on principal deposited, time-demand deposit, call deposit, swap management, and education deposit; personal certificate of deposit; salary financing A; and foreign currency deposit. It also provides credit, quasi-credit, and debit cards; new housing and second-hand mortgage loans and unsecured personal loans; personal wealth management advisor services; and precious metal and commodity trading services. In addition, the company offers corporate structured deposit and corporate certificate of deposit; corporate cash management; industrial chain finance program comprising prepayment financing, inventory financing, accounts receivable financing and accounts payable financing; syndicated loans; corporation overdraft; investment banking services; and offshore banking services, such as repayment financing, inventory financing, accounts receivable financing and accounts payable financing, and forex currencies. Further, it provides bond account activation, bond distribution, and transaction services; related bond escrow and settlement, pledge registration, and principal and interest payment services; training and consulting services for cooperative banks; cross-border inter-bank payments system services; consignment sales of precious metal products; bond underwriting distribution; third party bond depository services; bank derivatives transfer; b-share transfer; bankfutures transfer; standard warehouse warrant pledged financing; institutional investment consulting, wealth management, and insurance services; and clearing and settlement services for future markets. The company was founded in 1908 and is headquartered in Shanghai, the People’s Republic of China.

About Columbia Financial

Columbia Financial, Inc., a bank holding company, provides various financial services to businesses and consumers in the United States. Its deposit products include checking, interest-earning checking products and municipal, savings and club deposits, and money market accounts, as well as certificates of deposit. The company also provides various loans, including multifamily and commercial real estate loans, commercial business loans, one-to-four family residential loans, construction loans, home equity loans and advances, and other consumer loans, such as automobiles and personal loans, as well as unsecured and overdraft lines of credit. In addition, it offers title insurance products; wealth management services; and cash management services comprising remote deposit, lockbox service, sweep accounts, and escrow services. The company operates full-service banking offices in New Jersey; and branch offices in Freehold, New Jersey. Columbia Financial, Inc. was founded in 1926 and is based in Fair Lawn, New Jersey. Columbia Financial, Inc. is a subsidiary of Columbia Bank MHC.