Comparing Hanmi Financial (NASDAQ:HAFC) and Macro Bank (NYSE:BMA)

Macro Bank (NYSE:BMA) and Hanmi Financial (NASDAQ:HAFC) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, earnings, profitability and risk.

Risk and Volatility

Macro Bank has a beta of 1.38, meaning that its share price is 38% more volatile than the S&P 500. Comparatively, Hanmi Financial has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for Macro Bank and Hanmi Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Macro Bank	0	2	5	1	2.88
Hanmi Financial	0	4	2	0	2.33

Macro Bank presently has a consensus price target of $111.25, suggesting a potential upside of 40.67%. Hanmi Financial has a consensus price target of $33.00, suggesting a potential upside of 3.48%. Given Macro Bank’s stronger consensus rating and higher possible upside, research analysts plainly believe Macro Bank is more favorable than Hanmi Financial.

Dividends

Macro Bank pays an annual dividend of $5.45 per share and has a dividend yield of 6.9%. Hanmi Financial pays an annual dividend of $1.12 per share and has a dividend yield of 3.5%. Macro Bank pays out 119.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hanmi Financial pays out 37.7% of its earnings in the form of a dividend. Hanmi Financial has increased its dividend for 1 consecutive years.

Institutional and Insider Ownership

88.7% of Hanmi Financial shares are owned by institutional investors. 18.3% of Macro Bank shares are owned by company insiders. Comparatively, 2.1% of Hanmi Financial shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Macro Bank and Hanmi Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Macro Bank	$4.72 billion	1.07	$231.60 million	$4.57	17.30
Hanmi Financial	$444.90 million	2.13	$76.09 million	$2.97	10.74

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

Profitability

This table compares Macro Bank and Hanmi Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Macro Bank	5.95%	8.65%	2.04%
Hanmi Financial	19.82%	11.20%	1.13%

Summary

Macro Bank beats Hanmi Financial on 12 of the 18 factors compared between the two stocks.

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.

About Hanmi Financial

Hanmi Financial Corporation operates as the holding company for Hanmi Bank that provides business banking products and services in the United States. It offers various deposit products, including noninterest-bearing checking accounts, savings accounts, negotiable order of withdrawal accounts, money market accounts, and certificates of deposit. The company also provides real estate loans, such as commercial property, construction, and residential property loans; and commercial and industrial loans, such as commercial term loans and commercial lines of credit; and international finance and trade services and products, such as letters of credit, and import and export financing. In addition, it offers small business administration loans for business purposes, which comprise owner-occupied commercial real estate, business acquisitions, start-ups, franchise financing, working capital, improvements and renovations, inventory and equipment, and debt-refinancing, as well as equipment lease financing. The company was founded in 1982 and is headquartered in Los Angeles, California.