Contrasting Bank of Communications (OTCMKTS:BCMXY) and Fannie Mae (OTCMKTS:FNMA)

Bank of Communications (OTCMKTS:BCMXY) and Fannie Mae (OTCMKTS:FNMA) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, earnings, analyst recommendations, dividends, valuation, institutional ownership and profitability.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Bank of Communications and Fannie Mae, 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
Fannie Mae	1	5	0	0	1.83

Fannie Mae has a consensus price target of $8.70, suggesting a potential upside of 135.14%. Given Fannie Mae’s higher probable upside, analysts clearly believe Fannie Mae is more favorable than Bank of Communications.

Volatility and Risk

Bank of Communications has a beta of -0.04, indicating that its share price is 104% less volatile than the S&P 500. Comparatively, Fannie Mae has a beta of 1.68, indicating that its share price is 68% more volatile than the S&P 500.

Insider and Institutional Ownership

0.0% of Fannie Mae shares are held by institutional investors. 1.0% of Fannie Mae shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Bank of Communications and Fannie Mae’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%
Fannie Mae	4.59%	-76.66%	0.51%

Valuation & Earnings

This table compares Bank of Communications and Fannie Mae”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	1.06	$13.30 billion	$3.61	7.04
Fannie Mae	$159.17 billion	0.03	$14.36 billion	$0.04	92.50

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

Summary

Fannie Mae beats Bank of Communications on 7 of the 13 factors compared between the two stocks.

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 Fannie Mae

Federal National Mortgage Association provides financing solutions for mortgages in the United States. It operates through two segments, Single-Family and Multifamily. The Single-Family segment securitizes and purchases single-family fixed-rate or adjustable-rate, first-lien mortgage loans, or mortgage-related securities backed by these loans; and loans that are insured by Federal Housing Administration, loans guaranteed by the Department of Veterans Affairs and Rural Development Housing and Community Facilities Program of the U.S. Department of Agriculture, manufactured housing mortgage loans, and other mortgage-related securities. The Multifamily segment securitizes multifamily mortgage loans into Fannie Mae mortgage backed securities (MBS); purchases multifamily mortgage loans; and provides credit enhancement for bonds issued by state and local housing finance authorities to finance multifamily housing. This segment also issues structured MBS backed by Fannie Mae multifamily MBS; buys and sells multifamily agency mortgage-backed securities; and invests in low-income housing tax credit multifamily projects. Federal National Mortgage Association was founded in 1938 and is based in Washington, the District of Columbia.