Comparing Banco De Chile (BCH) and Old National Bancorp (NASDAQ:ONB)

Old National Bancorp (NASDAQ: ONB) and Banco De Chile (NYSE:BCH) are both mid-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, earnings, profitability, analyst recommendations, risk and institutional ownership.

Profitability

This table compares Old National Bancorp and Banco De Chile’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Old National Bancorp 21.61% 8.39% 1.05%
Banco De Chile 24.17% 18.18% 1.74%

Analyst Recommendations

This is a summary of recent ratings and price targets for Old National Bancorp and Banco De Chile, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Old National Bancorp 0 4 2 0 2.33
Banco De Chile 0 3 1 0 2.25

Old National Bancorp currently has a consensus price target of $18.92, indicating a potential upside of 11.60%. Banco De Chile has a consensus price target of $84.00, indicating a potential downside of 6.71%. Given Old National Bancorp’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Old National Bancorp is more favorable than Banco De Chile.

Insider & Institutional Ownership

71.7% of Old National Bancorp shares are owned by institutional investors. Comparatively, 1.6% of Banco De Chile shares are owned by institutional investors. 1.8% of Old National Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Old National Bancorp and Banco De Chile’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Old National Bancorp $699.96 million 3.28 $134.26 million $1.09 15.55
Banco De Chile $3.62 billion 4.16 $857.77 million $5.41 16.64

Banco De Chile has higher revenue and earnings than Old National Bancorp. Old National Bancorp is trading at a lower price-to-earnings ratio than Banco De Chile, indicating that it is currently the more affordable of the two stocks.

Dividends

Old National Bancorp pays an annual dividend of $0.52 per share and has a dividend yield of 3.1%. Banco De Chile pays an annual dividend of $2.12 per share and has a dividend yield of 2.4%. Old National Bancorp pays out 47.7% of its earnings in the form of a dividend. Banco De Chile pays out 39.2% 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. Banco De Chile has raised its dividend for 5 consecutive years.

Volatility and Risk

Old National Bancorp has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500. Comparatively, Banco De Chile has a beta of 0.48, indicating that its share price is 52% less volatile than the S&P 500.

Summary

Banco De Chile beats Old National Bancorp on 10 of the 17 factors compared between the two stocks.

About Old National Bancorp

Old National Bancorp is a financial holding company. The Company, through its banking subsidiary, provides a range of services, including commercial and consumer loan and depository services, private banking, brokerage, trust, investment advisory and other traditional banking services. The Company focuses on community banking. The Company’s banking segment operates through its subsidiary, Old National Bank. As of December 31, 2016, Old National Bank operated approximately 203 banking centers located in Indiana, Kentucky, Michigan and Wisconsin. As of December 31, 2016, Old National Bank leased 81 banking centers from unaffiliated third parties. Each of the branches of Old National Bank provide a group of similar community banking services, including products and services, such as commercial, real estate and consumer loans, time deposits, checking and savings accounts, cash management, brokerage, trust and investment advisory services.

About Banco De Chile

Banco de Chile is a full service financial institution, which is engaged in providing credit and non-credit products and services in Chile. The Bank offers a range of banking services to its customers, ranging from individuals to corporations. The Bank’s segments include Retail, which focuses on individuals and small and medium-sized companies, where the product offering focuses on consumer loans, commercial loans, checking accounts, credit cards, credit lines and mortgage loans; Wholesale, which focuses on corporate clients and companies, where the product offering focuses on commercial loans, checking accounts and liquidity management services, debt instruments, foreign trade, derivative contracts and leases; Treasury, which includes the associated revenues to the management of the investment portfolio and the business of financial transactions and currency trading, and Subsidiaries, which corresponds to companies and corporations controlled by the Bank.

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