Head to Head Analysis: BOK Financial (BOKF) and Meridian Bancorp (EBSB)

BOK Financial (NASDAQ: BOKF) and Meridian Bancorp (NASDAQ:EBSB) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, dividends, risk, institutional ownership, valuation, profitability and analyst recommendations.

Dividends

BOK Financial pays an annual dividend of $1.80 per share and has a dividend yield of 1.8%. Meridian Bancorp pays an annual dividend of $0.20 per share and has a dividend yield of 1.1%. BOK Financial pays out 34.0% of its earnings in the form of a dividend. Meridian Bancorp pays out 21.1% 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. BOK Financial has raised its dividend for 13 consecutive years and Meridian Bancorp has raised its dividend for 2 consecutive years. BOK Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

33.5% of BOK Financial shares are owned by institutional investors. Comparatively, 68.8% of Meridian Bancorp shares are owned by institutional investors. 60.5% of BOK Financial shares are owned by insiders. Comparatively, 5.3% of Meridian Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares BOK Financial and Meridian Bancorp’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
BOK Financial $1.67 billion 3.86 $334.64 million $5.29 18.62
Meridian Bancorp $208.17 million 4.77 $42.94 million $0.95 19.37

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

Analyst Recommendations

This is a summary of current ratings for BOK Financial and Meridian Bancorp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BOK Financial 0 6 3 0 2.33
Meridian Bancorp 0 1 0 0 2.00

BOK Financial presently has a consensus target price of $106.72, suggesting a potential upside of 8.37%. Meridian Bancorp has a consensus target price of $24.00, suggesting a potential upside of 30.43%. Given Meridian Bancorp’s higher probable upside, analysts plainly believe Meridian Bancorp is more favorable than BOK Financial.

Profitability

This table compares BOK Financial and Meridian Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BOK Financial 21.91% 11.04% 1.18%
Meridian Bancorp 21.43% 8.56% 1.05%

Risk and Volatility

BOK Financial has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500. Comparatively, Meridian Bancorp has a beta of 0.21, indicating that its share price is 79% less volatile than the S&P 500.

Summary

BOK Financial beats Meridian Bancorp on 12 of the 17 factors compared between the two stocks.

BOK Financial Company Profile

BOK Financial Corporation operates as the financial holding company for BOKF, NA that provides various financial products and services in Oklahoma, Texas, New Mexico, Northwest Arkansas, Colorado, Arizona, and Kansas/Missouri. It operates through three segments: Commercial Banking, Consumer Banking, and Wealth Management. The Commercial Banking segment offers lending, treasury, and cash management services, as well as customer risk management products for small businesses, middle market, and larger commercial customers. This segment also operates TransFund electronic funds network. The Consumer Banking segment provides lending and deposit services to small business customers through the retail branch network; and mortgage banking services. The Wealth Management segment offers fiduciary, private banking, and investment advisory services; and brokerage and trading services, as well as underwrites state and municipal securities. The company also provides commercial loans, such as loans for working capital, facilities acquisition or expansion, purchases of equipment, and other needs of commercial customers; and service, healthcare, wholesale/retail sector, and energy sector loans. In addition, it offers commercial real estate loans for the construction of buildings or other enhancements to real estate and property held by borrowers for investment purposes; and residential mortgage, personal, and home equity loans. Further, the company provides automated teller machines, call center, and Internet and mobile banking services. As of December 31, 2017, it operated 2,223 TransFund ATM locations. BOK Financial Corporation was founded in 1910 and is headquartered in Tulsa, Oklahoma.

Meridian Bancorp Company Profile

Meridian Bancorp, Inc. operates as a holding company, which engages in the provision of banking and financial services, through East Boston Savings Bank. It offers banking products such as mobile banking; retirement services; investments; savings and certificates of deposits; personal lending; auto loan; line of credit, and cash management. The company was founded on March 6, 2014 and is headquartered in Peabody, MA.

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