China Construction Bank (OTCMKTS:CICHY – Get Free Report) and Columbia Banking System (NASDAQ:COLB – Get Free Report) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, valuation, institutional ownership, earnings and dividends.
Earnings & Valuation
This table compares China Construction Bank and Columbia Banking System”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| China Construction Bank | $181.98 billion | 1.79 | $47.15 billion | $3.72 | 6.68 |
| Columbia Banking System | $2.63 billion | 3.22 | $550.00 million | $2.51 | 11.91 |
Profitability
This table compares China Construction Bank and Columbia Banking System’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| China Construction Bank | 27.65% | 9.82% | 0.78% |
| Columbia Banking System | 19.96% | 11.33% | 1.31% |
Insider and Institutional Ownership
92.5% of Columbia Banking System shares are owned by institutional investors. 0.6% of Columbia Banking System shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Dividends
China Construction Bank pays an annual dividend of $0.93 per share and has a dividend yield of 3.7%. Columbia Banking System pays an annual dividend of $1.48 per share and has a dividend yield of 4.9%. China Construction Bank pays out 25.0% of its earnings in the form of a dividend. Columbia Banking System pays out 59.0% 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. Columbia Banking System has raised its dividend for 4 consecutive years. Columbia Banking System is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Ratings
This is a summary of recent ratings for China Construction Bank and Columbia Banking System, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| China Construction Bank | 0 | 1 | 0 | 0 | 2.00 |
| Columbia Banking System | 0 | 8 | 5 | 0 | 2.38 |
Columbia Banking System has a consensus price target of $33.83, indicating a potential upside of 13.15%. Given Columbia Banking System’s stronger consensus rating and higher probable upside, analysts clearly believe Columbia Banking System is more favorable than China Construction Bank.
Risk & Volatility
China Construction Bank has a beta of 0.11, meaning that its stock price is 89% less volatile than the S&P 500. Comparatively, Columbia Banking System has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500.
Summary
Columbia Banking System beats China Construction Bank on 12 of the 17 factors compared between the two stocks.
About China Construction Bank
China Construction Bank Corporation provides various banking and related financial services to individuals and corporate customers in the People's Republic of China and internationally. It operates through Corporate Finance Business, Personal Finance Business, Treasury and Asset Management Business, and Others segments. The company accepts various deposits, such as foreign currency, all in one accounts, RMB, corporate term and notification, and corporate demand deposits, as well corporate deposits by agreement. Its loan products include personal business, car, and housing loans; and SME, traditional credit, commercial draft, buyer credit, and RMB credit line loans. The company also offers credit cards; physical gold for personal investment and personal gold accounts; foreign exchange services; certificate treasury and savings bonds, securities deposit accounts, and securities services, as well as bank-securities transfer and book-entry treasury bond over the counter transaction services; and wealth management products. In addition, it provides collection, salaries payment, third-party collection and payment, insurance agency, and remittance services; international settlement and financing, and FI services; securities and fund settlement services; guarantee-based, consulting and advising, and factoring services; fund custody services; and e-banking services. Further, the company offers institutional services comprising services for government agencies, social security, banks cooperation, bank-securities cooperation, bank-insurance cooperation, and services for non-banking financial institutions. China Construction Bank Corporation was founded in 1954 and is headquartered in Beijing, the People's Republic of China.
About Columbia Banking System
Columbia Banking System, Inc. operates as the holding company of Umpqua Bank that provides banking, private banking, mortgage, and other financial services in the United States. The company offers deposit products, including business, non-interest bearing checking, interest-bearing checking and savings, money market, and certificate of deposit accounts; and insured cash sweep and other investment sweep solutions. It also provides commercial lending products, such as commercial lines of credit and term loans, accounts receivable and inventory financing, international trade finance, commercial property loans, multifamily loans, equipment loans, commercial equipment leases, real estate construction loans and permanent financing, and small business administration program financing, as well as capital markets. In addition, the company offers wealth management comprising financial planning, investment, trust, and insurance; treasury management, which includes digital and mobile banking solutions, ACH, wires, positive pay, remote deposit capture, integrated payments, integrated receivables, lockbox, cash vault, real-time payments, commercial card, and foreign exchange and international banking related products, as well as merchant services; and brokerage services, residential real estate loans and consumer loans. It serves its products to corporate, institutional, small business, and individual customers. The company was founded in 1953 and is headquartered in Tacoma, Washington.
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