Financial Comparison: Home BancShares (NYSE:HOMB) & Svenska Handelsbanken Ab Publ (OTCMKTS:SVNLY)

Svenska Handelsbanken Ab Publ (OTCMKTS:SVNLY) and Home BancShares (NYSE:HOMB) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, dividends, risk, institutional ownership and valuation.

Insider & Institutional Ownership

67.3% of Home BancShares shares are held by institutional investors. 6.4% of Home BancShares shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Svenska Handelsbanken Ab Publ and Home BancShares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Svenska Handelsbanken Ab Publ	17.75%	14.30%	0.72%
Home BancShares	32.10%	11.12%	2.07%

Dividends

Svenska Handelsbanken Ab Publ pays an annual dividend of $0.58 per share and has a dividend yield of 7.5%. Home BancShares pays an annual dividend of $0.92 per share and has a dividend yield of 3.1%. Svenska Handelsbanken Ab Publ pays out 81.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Home BancShares pays out 38.0% of its earnings in the form of a dividend. Home BancShares has increased its dividend for 15 consecutive years.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Svenska Handelsbanken Ab Publ and Home BancShares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Svenska Handelsbanken Ab Publ	4	1	0	0	1.20
Home BancShares	0	4	5	0	2.56

Home BancShares has a consensus price target of $33.00, suggesting a potential upside of 11.09%. Given Home BancShares’ stronger consensus rating and higher probable upside, analysts clearly believe Home BancShares is more favorable than Svenska Handelsbanken Ab Publ.

Earnings and Valuation

This table compares Svenska Handelsbanken Ab Publ and Home BancShares”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Svenska Handelsbanken Ab Publ	$21.75 billion	1.41	$2.42 billion	$0.71	10.87
Home BancShares	$1.48 billion	4.02	$475.44 million	$2.42	12.28

Svenska Handelsbanken Ab Publ has higher revenue and earnings than Home BancShares. Svenska Handelsbanken Ab Publ is trading at a lower price-to-earnings ratio than Home BancShares, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Svenska Handelsbanken Ab Publ has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, Home BancShares has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500.

Summary

Home BancShares beats Svenska Handelsbanken Ab Publ on 13 of the 17 factors compared between the two stocks.

About Svenska Handelsbanken Ab Publ

Svenska Handelsbanken AB (publ) provides various banking products and services for private and corporate customers primarily in Sweden, the United Kingdom, Norway, the Netherlands, the United States, Luxembourg, Finland, and Poland. The company offers savings, transactions, business, currency, and investment accounts, as well as accounts for cash pool, and forestry and agriculture; mortgage and committed loans, and private loans; mutual funds; pension products; credit and debit cards; and payment and reconciliation services, as well as foreign exchange rate services. It also provides financing for investments, such as equipment, cars, computers, and other inventories, as well as vehicle and real estate financing services; green loans and advisor services; investment and other financing services; medical care, and group and health insurance products; forestry and farming banking products; and online and mobile banking services, as well as various banking services for children and young people. In addition, the company offers financial services, that includes asset management, transactional banking, corporate finance, financing, markets, trade finance, market information and research services to large corporations; cash management solutions; and various corporate banking services to small and medium-sized companies and large corporates, as well as private banking services. Svenska Handelsbanken AB (publ) was incorporated in 1871 and is headquartered in Stockholm, Sweden.

About Home BancShares

Home Bancshares, Inc. (Conway, AR) operates as the bank holding company for Centennial Bank that provides commercial and retail banking, and related financial services to businesses, real estate developers and investors, individuals, and municipalities. Its deposit products include checking, savings, and money market accounts, as well as certificates of deposit. The company's loan portfolio comprises non-farm/non-residential real estate, construction/land development, residential mortgage, consumer, agricultural, and commercial and industrial loans. It provides internet banking, mobile banking and voice response information, cash management, overdraft protection, direct deposit, and automatic account transfer services, as well as safe deposit boxes and the United States savings bonds. In addition, the company writes policies for commercial and personal lines of business, including insurance for property, casualty, life, health, and employee benefits. It operates through branches in Arkansas, Florida, Alabama, Texas, and New York City. Home Bancshares, Inc. (Conway, AR) was founded in 1998 and is headquartered in Conway, Arkansas.