Contrasting Itaú Unibanco (NYSE:ITUB) and Surrey Bancorp (OTCMKTS:SRYB)

Itaú Unibanco (NYSE:ITUB) and Surrey Bancorp (OTCMKTS:SRYB) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, risk, valuation, earnings, institutional ownership, analyst recommendations and dividends.

Earnings & Valuation

This table compares Itaú Unibanco and Surrey Bancorp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Itaú Unibanco	$160.96 billion	0.45	$7.62 billion	$0.71	9.49
Surrey Bancorp	$16.20 million	4.23	$5.10 million	$1.52	10.99

Itaú Unibanco has higher revenue and earnings than Surrey Bancorp. Itaú Unibanco is trading at a lower price-to-earnings ratio than Surrey Bancorp, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

3.7% of Surrey Bancorp shares are held by institutional investors. 0.6% of Itaú Unibanco shares are held by company insiders. Comparatively, 33.7% of Surrey Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Itaú Unibanco and Surrey Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Itaú Unibanco	0	0	4	1	3.20
Surrey Bancorp	0	0	0	0	0.00

Itaú Unibanco presently has a consensus price target of $6.27, indicating a potential downside of 6.93%. Given Itaú Unibanco’s stronger consensus rating and higher possible upside, analysts clearly believe Itaú Unibanco is more favorable than Surrey Bancorp.

Profitability

This table compares Itaú Unibanco and Surrey Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Itaú Unibanco	12.25%	19.46%	1.47%
Surrey Bancorp	37.97%	N/A	N/A

Risk & Volatility

Itaú Unibanco has a beta of 0.77, meaning that its stock price is 23% less volatile than the S&P 500. Comparatively, Surrey Bancorp has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500.

Dividends

Itaú Unibanco pays an annual dividend of $0.02 per share and has a dividend yield of 0.3%. Surrey Bancorp pays an annual dividend of $0.48 per share and has a dividend yield of 2.9%. Itaú Unibanco pays out 2.8% of its earnings in the form of a dividend. Surrey Bancorp pays out 31.6% 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.

Summary

Itaú Unibanco beats Surrey Bancorp on 10 of the 17 factors compared between the two stocks.

About Itaú Unibanco

Itaú Unibanco Holding S.A. offers a range of financial products and services to individuals and corporate customers in Brazil and internationally. The company operates through three segments: Retail Banking, Wholesale Banking, and Activities with the Market + Corporation. It offers current account; loans; credit and debit cards; investment and commercial banking services; real estate lending services; financing and investment services; economic, financial and brokerage advisory; and leasing and foreign exchange services. The company also provides property and casualty insurance products covering loss, damage, or liabilities for assets or persons, as well as life insurance products covering death and personal accident. It serves retail customers, account and non-account holders, individuals and legal entities, high income clients, microenterprises, and small companies, as well as middle-market companies and high net worth clients. The company was formerly known as Itaú Unibanco Banco Múltiplo S.A. and changed its name to Itaú Unibanco Holding S.A. in April 2009. The company was incorporated in 1924 and is headquartered in São Paulo, Brazil. Itaú Unibanco Holding S.A. operates as a subsidiary of IUPAR – Itaú Unibanco Participações S.A.

About Surrey Bancorp

Surrey BanCorp engages in the provision of banking solutions through its subsidiaries, Surrey Bank & Trust . It offers checking accounts, savings, deposit services, mortgages, real estate loans, commercial credit products, business checking, and electronic banking. The company was founded on May 1, 2003 and is headquartered in Mount Airy, NC.