China Merchants Bank (OTCMKTS:CIHKY – Get Free Report) and Macro Bank (NYSE:BMA – Get Free Report) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, profitability, valuation, dividends, institutional ownership and earnings.
Volatility and Risk
China Merchants Bank has a beta of 0.21, meaning that its stock price is 79% less volatile than the S&P 500. Comparatively, Macro Bank has a beta of 1.43, meaning that its stock price is 43% more volatile than the S&P 500.
Earnings and Valuation
This table compares China Merchants Bank and Macro Bank”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| China Merchants Bank | $65.04 billion | 2.33 | $20.89 billion | $4.03 | 7.47 |
| Macro Bank | $4.72 billion | 1.22 | $231.60 million | $4.23 | 21.28 |
China Merchants Bank has higher revenue and earnings than Macro Bank. China Merchants Bank is trading at a lower price-to-earnings ratio than Macro Bank, indicating that it is currently the more affordable of the two stocks.
Dividends
China Merchants Bank pays an annual dividend of $1.19 per share and has a dividend yield of 4.0%. Macro Bank pays an annual dividend of $5.45 per share and has a dividend yield of 6.1%. China Merchants Bank pays out 29.5% of its earnings in the form of a dividend. Macro Bank pays out 128.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Analyst Ratings
This is a summary of current recommendations for China Merchants Bank and Macro Bank, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| China Merchants Bank | 0 | 1 | 0 | 0 | 2.00 |
| Macro Bank | 0 | 1 | 6 | 1 | 3.00 |
Macro Bank has a consensus target price of $111.25, suggesting a potential upside of 23.58%. Given Macro Bank’s stronger consensus rating and higher possible upside, analysts clearly believe Macro Bank is more favorable than China Merchants Bank.
Profitability
This table compares China Merchants Bank and Macro Bank’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| China Merchants Bank | 32.40% | 12.14% | 1.21% |
| Macro Bank | 5.81% | 8.42% | 1.99% |
Summary
Macro Bank beats China Merchants Bank on 9 of the 15 factors compared between the two stocks.
About China Merchants Bank
China Merchants Bank Co., Ltd., together with its subsidiaries, provides various banking products and services. It operates through Wholesale Finance Business, Retail Finance Business, and Other Business segments. The company offers current, demand, time, call, savings, notice, and renminbi accounts. Its loan products include personal commercial real estate, consumption, housing, and car loans; loans to finance for studying abroad; micro-business loans; mortgage loans for equipment; joint guarantee, special guarantee, and housing mortgage loan; bank acceptance, discount, liquid capital, and fixed asset loans; and loans for vessels. The company also offers credit cards; insurance products; open-ended funds; discount and guarantees for commercial bills, redemption of commercial bills, and guaranteed discount for commercial acceptance bills; and financial consultation, debt financing underwriting, merger and acquisition financing, and equity financing and enterprise listing services. In addition, it provides forfeiting and risk participation, escrow, cross-border RMB clearing, and interbank services; and risk and financial management, cross-border RMB and oversea financing, international factoring and settlement, and trade finance services. Further, the company offers financial leasing and guarantee, investment and wealth management, forex option and gold trading, forex express trading, international, offshore and private banking, custody, pension, and electronic banking services. The company also operates in Hong Kong, New York, London, Singapore, Luxembourg, Sydney, and Taipei. China Merchants Bank Co., Ltd. was founded in 1987 and is headquartered in Shenzhen, China.
About Macro Bank
Banco Macro S.A. provides various banking products and services to retail and corporate customers in Argentina. It offers various retail banking products and services, such as savings and checking accounts, time deposits, credit and debit cards, consumer finance loans, mortgage loans, automobile loans, overdrafts, credit-related services, home and car insurance coverage, tax collection, utility payments, automated teller machines, and money transfers. The company also provides personal loans, document discounts, residential mortgages, overdrafts, pledged loans, and credit card loans to retail customers. In addition, it offers corporate banking products and services, including deposits, lending, check cashing advances and factoring, guaranteed loans, credit lines for financing foreign trade, and cash management services; and trust, payroll, and financial agency services, as well as corporate credit cards and other specialty products; and working capital facilities, credit for investment projects, and leasing and foreign trade transactions. Further, the company provides transaction services, such as cash management, collection services, payments to suppliers, payroll services, foreign exchange transactions, and foreign trade services; information services comprising Datanet and Interpymes services to corporate customers; and Internet and mobile banking services. Additionally, it offers short-term and medium-to-long-term corporate lending products. Banco Macro S.A. was incorporated in 1966 and is headquartered in Buenos Aires, Argentina.
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