Critical Analysis: Metro Bancorp (METR) vs. Zions Bancorp (ZION)

Metro Bancorp (NASDAQ: METR) and Zions Bancorp (NASDAQ:ZION) are both financials companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, earnings, analyst recommendations, institutional ownership, profitability, valuation and dividends.

Insider & Institutional Ownership

94.0% of Zions Bancorp shares are held by institutional investors. 1.5% of Zions Bancorp shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and target prices for Metro Bancorp and Zions Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Metro Bancorp 0 0 0 0 N/A
Zions Bancorp 1 5 12 0 2.61

Zions Bancorp has a consensus target price of $55.12, suggesting a potential downside of 1.01%.

Profitability

This table compares Metro Bancorp and Zions Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Metro Bancorp 16.68% 7.88% 0.75%
Zions Bancorp 21.58% 9.04% 0.98%

Valuation & Earnings

This table compares Metro Bancorp and Zions Bancorp’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Metro Bancorp N/A N/A N/A $1.40 N/A
Zions Bancorp $2.74 billion 4.02 $592.00 million $2.60 21.42

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

Dividends

Metro Bancorp pays an annual dividend of $0.28 per share. Zions Bancorp pays an annual dividend of $0.80 per share and has a dividend yield of 1.4%. Metro Bancorp pays out 20.0% of its earnings in the form of a dividend. Zions Bancorp pays out 30.8% 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

Zions Bancorp beats Metro Bancorp on 10 of the 11 factors compared between the two stocks.

Metro Bancorp Company Profile

Metro Bancorp, Inc. is a bank holding company. The Company provides full banking services through its subsidiary, Metro Bank (the Bank), which is a state-chartered bank. The Bank offers its lending and depository services from its main store in Lemoyne, Pennsylvania, and its around 33 other full-service stores located in Cumberland, Dauphin, York, Berks, Lancaster and Lebanon Counties, Pennsylvania. The Bank provides retail and commercial banking services for consumers and small and mid-sized companies. The Bank’s lending and investment activities are funded principally by retail deposits gathered through its retail store office network. The Bank provides a range of retail banking services and products, including free personal checking accounts and business checking accounts, regular savings accounts, money market accounts, interest checking accounts, fixed rate certificates of deposit (CDs), individual retirement accounts, club accounts, and debit card services, among others.

Zions Bancorp Company Profile

Zions Bancorporation is a financial holding company. The Company conducts its banking operations through separately managed and branded segments, including Zions Bank, Amegy Bank, California Bank & Trust, National Bank of Arizona, Nevada State Bank (NSB), Vectra Bank Colorado, The Commerce Bank of Washington (TCBW) and Other. It focuses on providing community banking services through its business lines, including small and medium-sized business and corporate banking; commercial and residential development, construction and term lending; retail banking; treasury cash management and related products and services; residential mortgage servicing and lending; trust and wealth management; limited capital markets activities, including municipal finance advisory and underwriting, and investment activities. It provides a range of banking and related services, primarily in Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah, Washington and Wyoming.

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