Community Bancorp (NASDAQ:CMTV – Get Free Report) and Fifth Third Bancorp (NASDAQ:FITB – Get Free Report) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, earnings, valuation, analyst recommendations, institutional ownership and profitability.
Risk and Volatility
Community Bancorp has a beta of 0.38, indicating that its stock price is 62% less volatile than the S&P 500. Comparatively, Fifth Third Bancorp has a beta of 0.97, indicating that its stock price is 3% less volatile than the S&P 500.
Insider & Institutional Ownership
83.8% of Fifth Third Bancorp shares are owned by institutional investors. 6.6% of Community Bancorp shares are owned by company insiders. Comparatively, 0.5% of Fifth Third Bancorp shares are owned 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.
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Community Bancorp | $68.79 million | 3.45 | $16.97 million | $3.29 | 12.87 |
| Fifth Third Bancorp | $10.49 billion | 4.34 | $2.52 billion | $2.93 | 17.16 |
Fifth Third Bancorp has higher revenue and earnings than Community Bancorp. Community Bancorp is trading at a lower price-to-earnings ratio than Fifth Third Bancorp, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Community Bancorp and Fifth Third Bancorp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Community Bancorp | 25.65% | 15.97% | 1.50% |
| Fifth Third Bancorp | 15.89% | 12.39% | 1.20% |
Analyst Ratings
This is a summary of recent recommendations for Community Bancorp and Fifth Third Bancorp, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Community Bancorp | 0 | 0 | 0 | 1 | 4.00 |
| Fifth Third Bancorp | 0 | 4 | 18 | 1 | 2.87 |
Fifth Third Bancorp has a consensus price target of $60.92, suggesting a potential upside of 21.19%. Given Fifth Third Bancorp’s higher probable upside, analysts plainly believe Fifth Third Bancorp is more favorable than Community Bancorp.
Dividends
Community Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 2.4%. Fifth Third Bancorp pays an annual dividend of $1.68 per share and has a dividend yield of 3.3%. Community Bancorp pays out 30.4% of its earnings in the form of a dividend. Fifth Third Bancorp pays out 57.3% 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. Fifth Third Bancorp has increased its dividend for 14 consecutive years. Fifth Third Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Summary
Fifth Third Bancorp beats Community Bancorp on 10 of the 17 factors compared between the two stocks.
About Community Bancorp
Community Bancorp. operates as the bank holding company for Community National Bank that provides a range of retail banking services to residents, businesses, nonprofit organizations, and municipalities. It provides various consumer banking products and services, including checking accounts, savings programs, ATMs, debit/credit cards, and night deposit facilities, as well as online, mobile, and telephone banking. The company’s business banking products and services comprise credit products for various business purposes, including financing for commercial business properties, equipment, inventories, and accounts receivable, as well as letters of credit; and business checking and other deposit accounts, cash management services, repurchase agreements, ACH and wire transfer services, and remote deposit capture. It offers commercial real estate lending products for commercial developers and investors, residential builders and developers, and community development entities, which include credit products to facilitate the purchase of land and/or build structures for business, for investors to develop residential or commercial properties, and for real estate secured financing of existing businesses, as well as financing to startups and other small businesses. The company’s residential real estate lending products include fixed-rate and adjustable rate residential mortgage and home equity loans; retail credit products include personal, automobile, and boat/recreational vehicle loans; and municipal and institutional banking products and services for state and local governments, schools, charities, membership, and not-for-profit associations comprise deposit accounts, tax-exempt loans, lines of credit, and term loans, as well as a collateralized secured deposit products. It operates through a main office in Derby; and eleven branch offices in northeastern and central Vermont. Community Bancorp. was founded in 1851 and is headquartered in Derby, Vermont.
About Fifth Third Bancorp
Fifth Third Bancorp operates as the bank holding company for Fifth Third Bank, National Association that engages in the provision of a range of financial products and services in the United States. It operates through three segments: Commercial Banking, Consumer and Small Business Banking, and Wealth and Asset Management. The Commercial Banking segment offers credit intermediation, cash management, and financial services; lending and depository products; and cash management, foreign exchange and international trade finance, derivatives and capital markets services, asset-based lending, real estate finance, public finance, commercial leasing, and syndicated finance for business, government, and professional customers. The Consumer and Small Banking segment provides a range of deposit and loan products to individuals and small businesses; home equity loans and lines of credit; credit cards; and cash management services. This segment also engages in the residential mortgage that include origination, retention and servicing of residential mortgage loans, sales and securitizations of loans, and hedging activities; indirect lending, including extending loans to consumers through automobile dealers, motorcycle dealers, powersport dealers, recreational vehicle dealers, and marine dealers; and home improvement and solar energy installation loans through contractors and installers. The Wealth & Asset Management segment provides various wealth management services for individuals, companies, and not-for-profit organizations. It offers retail brokerage services to individual clients; and broker dealer services to the institutional marketplace. This segment also provides wealth planning, investment management, banking, insurance, and trust and estate services; and advisory services for institutional clients comprising middle market businesses, non-profits, states, and municipalities. The company was founded in 1858 and is headquartered in Cincinnati, Ohio.
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