Head-To-Head Contrast: Eastern Bankshares (NASDAQ:EBC) and Credicorp (NYSE:BAP)

Credicorp (NYSE:BAP) and Eastern Bankshares (NASDAQ:EBC) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their risk, analyst recommendations, dividends, institutional ownership, profitability, valuation and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Credicorp and Eastern Bankshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Credicorp	0	2	5	0	2.71
Eastern Bankshares	0	3	6	0	2.67

Credicorp presently has a consensus price target of $431.80, suggesting a potential upside of 13.37%. Eastern Bankshares has a consensus price target of $24.86, suggesting a potential upside of 18.28%. Given Eastern Bankshares’ higher probable upside, analysts clearly believe Eastern Bankshares is more favorable than Credicorp.

Profitability

This table compares Credicorp and Eastern Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Credicorp	25.04%	20.52%	2.87%
Eastern Bankshares	25.12%	8.71%	1.24%

Earnings and Valuation

This table compares Credicorp and Eastern Bankshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Credicorp	$25.62 billion	1.40	$1.94 billion	$26.99	14.11
Eastern Bankshares	$1.12 billion	4.27	$88.22 million	$1.76	11.94

Credicorp has higher revenue and earnings than Eastern Bankshares. Eastern Bankshares is trading at a lower price-to-earnings ratio than Credicorp, indicating that it is currently the more affordable of the two stocks.

Dividends

Credicorp pays an annual dividend of $14.47 per share and has a dividend yield of 3.8%. Eastern Bankshares pays an annual dividend of $0.60 per share and has a dividend yield of 2.9%. Credicorp pays out 53.6% of its earnings in the form of a dividend. Eastern Bankshares pays out 34.1% 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. Credicorp has raised its dividend for 3 consecutive years and Eastern Bankshares has raised its dividend for 5 consecutive years.

Insider and Institutional Ownership

89.8% of Credicorp shares are owned by institutional investors. Comparatively, 71.7% of Eastern Bankshares shares are owned by institutional investors. 15.9% of Credicorp shares are owned by insiders. Comparatively, 1.3% of Eastern Bankshares shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

Credicorp has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500. Comparatively, Eastern Bankshares has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500.

Summary

Credicorp beats Eastern Bankshares on 11 of the 17 factors compared between the two stocks.

About Credicorp

Credicorp Ltd. provides various financial, insurance, and health services and products primarily in Peru and internationally. It operates through Universal Banking, Insurance and Pensions, Microfinance, and Investment Banking and Equity Management segments. The Universal Banking segment grants various credits and financial instruments to individuals and legal entities; and various deposits and current accounts. The Insurance and Pensions segment issues insurance policies to cover losses in commercial property, transport, marine vessels, automobiles, life, health, and pensions; and management services for private pension funds. The Microfinance segment provides management of loans, deposits, and current accounts for small and microenterprises. The Investment Banking and Equity Management segment is involved in provision of brokerage and investment management services for corporations, institutional investors, governments, and foundations; structuring and placement of issues in the primary market; execution and negotiation of transactions in the secondary market; and structuring of securitization processes for corporate customers and manages mutual funds. The company was founded in 1889 and is headquartered in Lima, Peru.

About Eastern Bankshares

Eastern Bankshares, Inc. operates as the bank holding company for Eastern Bank that provides banking products and services primarily to retail, commercial, and small business customers. The company provides deposit accounts, interest checking accounts, money market accounts, savings accounts, and time certificates of deposit accounts. It also offers commercial and industrial, commercial real estate and construction, small business, residential real estate, and home equity loans; lines of credit; and other consumer loans comprising unsecured personal lines of credit, overdraft protection, automobile loans, home improvement loans, airplane loans, and other personal loans. In addition, the company provides trust, financial planning and portfolio management, automated lock box collection, cash management, and account reconciliation services; personal, business, and employee benefits insurance products. Eastern Bankshares, Inc. was founded in 1818 and is headquartered in Boston, Massachusetts.