Macro Bank (NYSE:BMA) & Merchants Bancorp (NASDAQ:MBIN) Head to Head Review

Merchants Bancorp (NASDAQ:MBIN) and Macro Bank (NYSE:BMA) are both mid-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, earnings, profitability, institutional ownership, valuation and analyst recommendations.

Risk & Volatility

Merchants Bancorp has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500. Comparatively, Macro Bank has a beta of 1.38, suggesting that its stock price is 38% more volatile than the S&P 500.

Valuation and Earnings

This table compares Merchants Bancorp and Macro Bank”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Merchants Bancorp	$709.19 million	3.44	$218.77 million	$4.98	10.67
Macro Bank	$4.72 billion	1.05	$231.60 million	$4.57	17.02

Macro Bank has higher revenue and earnings than Merchants Bancorp. Merchants Bancorp 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 Merchants Bancorp and Macro Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Merchants Bancorp	19.80%	15.29%	1.34%
Macro Bank	5.95%	8.65%	2.04%

Dividends

Merchants Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 0.8%. Macro Bank pays an annual dividend of $5.45 per share and has a dividend yield of 7.0%. Merchants Bancorp pays out 8.8% of its earnings in the form of a dividend. 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. Merchants Bancorp has increased its dividend for 8 consecutive years.

Insider & Institutional Ownership

24.6% of Merchants Bancorp shares are held by institutional investors. 44.9% of Merchants Bancorp shares are held by company insiders. Comparatively, 18.3% of Macro Bank shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for Merchants Bancorp and Macro Bank, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Merchants Bancorp	0	2	2	1	2.80
Macro Bank	0	2	5	1	2.88

Merchants Bancorp currently has a consensus price target of $55.50, indicating a potential upside of 4.42%. Macro Bank has a consensus price target of $111.25, indicating a potential upside of 43.05%. Given Macro Bank’s stronger consensus rating and higher probable upside, analysts plainly believe Macro Bank is more favorable than Merchants Bancorp.

Summary

Macro Bank beats Merchants Bancorp on 9 of the 17 factors compared between the two stocks.

About Merchants Bancorp

Merchants Bancorp operates as the diversified bank holding company in the United States. It operates through three segments: Multi-family Mortgage Banking, Mortgage Warehousing, and Banking. The Multi-family Mortgage Banking segment engages in the mortgage banking, which originates and services government sponsored mortgages, including bridge financing products to refinance, acquire, or reposition multi-family housing projects, and construction lending for multi-family and healthcare facilities. This segment also offers customized loan products for need-based skilled nursing facilities, such as independent living, assisted living, and memory care; and tax credit equity syndicator service. The Mortgage Warehousing segment funds agency eligible residential loans, as well as commercial loans to non-depository financial institutions. The Banking segment offers a range of financial products and services to consumers and businesses, which includes retail banking, commercial lending, agricultural lending, retail and correspondent residential mortgage banking, and small business administration lending. Merchants Bancorp was founded in 1990 and is headquartered in Carmel, Indiana.

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.