Wintrust Financial (NASDAQ:WTFC – Get Free Report) and Community Trust Bancorp (NASDAQ:CTBI – Get Free Report) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, valuation, analyst recommendations, institutional ownership, earnings, profitability and dividends.
Profitability
This table compares Wintrust Financial and Community Trust Bancorp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Wintrust Financial | 20.72% | 13.37% | 1.28% |
| Community Trust Bancorp | 25.55% | 12.52% | 1.60% |
Risk and Volatility
Wintrust Financial has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500. Comparatively, Community Trust Bancorp has a beta of 0.52, meaning that its stock price is 48% less volatile than the S&P 500.
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Wintrust Financial | $4.23 billion | 2.26 | $823.84 million | $12.45 | 11.39 |
| Community Trust Bancorp | $409.34 million | 3.29 | $98.06 million | $5.97 | 12.43 |
Wintrust Financial has higher revenue and earnings than Community Trust Bancorp. Wintrust Financial is trading at a lower price-to-earnings ratio than Community Trust Bancorp, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent recommendations for Wintrust Financial and Community Trust Bancorp, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Wintrust Financial | 0 | 5 | 9 | 0 | 2.64 |
| Community Trust Bancorp | 0 | 2 | 1 | 1 | 2.75 |
Wintrust Financial presently has a consensus price target of $176.50, indicating a potential upside of 24.45%. Community Trust Bancorp has a consensus price target of $81.50, indicating a potential upside of 9.81%. Given Wintrust Financial’s higher probable upside, equities analysts clearly believe Wintrust Financial is more favorable than Community Trust Bancorp.
Institutional and Insider Ownership
93.5% of Wintrust Financial shares are owned by institutional investors. Comparatively, 60.2% of Community Trust Bancorp shares are owned by institutional investors. 1.2% of Wintrust Financial shares are owned by insiders. Comparatively, 2.6% of Community Trust Bancorp shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Dividends
Wintrust Financial pays an annual dividend of $2.20 per share and has a dividend yield of 1.6%. Community Trust Bancorp pays an annual dividend of $2.60 per share and has a dividend yield of 3.5%. Wintrust Financial pays out 17.7% of its earnings in the form of a dividend. Community Trust Bancorp pays out 43.6% 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. Wintrust Financial has increased its dividend for 12 consecutive years and Community Trust Bancorp has increased its dividend for 44 consecutive years. Community Trust Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
About Wintrust Financial
Wintrust Financial Corporation operates as a financial holding company. It operates in three segments: Community Banking, Specialty Finance, and Wealth Management. The Community Banking segment offers non-interest bearing deposits, non-brokered interest-bearing transaction accounts, and savings and domestic time deposits; home equity, consumer, and real estate loans; safe deposit facilities; and automatic teller machine (ATM), online and mobile banking, and other services. It also engages in the retail origination and purchase of residential mortgages; and provision of lending, deposits, and treasury management services to condominium, homeowner, and community associations, as well as asset-based lending for middle-market companies. In addition, this segment offers loan and deposit services to mortgage brokerage companies; lending to restaurant franchisees; direct leasing; small business administration loans; commercial mortgages and construction loans; and financial solutions. It provides personal and commercial banking services primarily to individuals, small to mid-sized businesses, local governmental units, and institutional clients. The Specialty Finance segment offers commercial and life insurance premiums financing for businesses and individuals; accounts receivable financing, value-added, and out-sourced administrative services; other specialty finance services; equipment financing through structured loan and lease products; and property and casualty premium financing; as well as data processing of payrolls, billing, and cash management services to temporary staffing industry. The Wealth Management segment provides wealth management services, such as trust and investment, asset management, tax-deferred exchange, securities brokerage, and retirement plan services. Wintrust Financial Corporation was founded in 1991 and is headquartered in Rosemont, Illinois.
About Community Trust Bancorp
Community Trust Bancorp, Inc. operates as the bank holding company for Community Trust Bank, Inc. that engages in the provision of commercial and personal banking, and trust and wealth management services to small and mid-sized communities in eastern, northeastern, central, and south-central Kentucky, as well as southern West Virginia, and northeastern Tennessee. The company accepts time and demand deposits, checking accounts, savings accounts and savings certificates, individual retirement accounts and Keogh plans, and money market accounts. Its loan portfolio includes commercial, construction, mortgage, and personal loans; lease-financing, lines of credit, revolving lines of credit, and term loans, as well as other specialized loans, including asset-based financing; residential and commercial real estate loans; and consumer loans. The company also provides cash management, renting safe deposit boxes, and funds transfer services; issues letters of credit; and acts as a trustee of personal trusts, executor of estates, trustee for employee benefit trusts, and paying agent for bond and stock issues, as well as an investment agent and depositor for securities. In addition, it offers securities brokerage services; debit cards; annuity and life insurance products; and repurchase agreements, as well as mobile, internet banking, and e-statement services. The company was founded in 1903 and is headquartered in Pikeville, Kentucky.
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