Head-To-Head Analysis: Independent Bank Gr (IBTX) and Banco Bradesco (BBD)

Independent Bank Gr (NASDAQ: IBTX) and Banco Bradesco (NYSE:BBD) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, institutional ownership, valuation, risk and profitability.

Earnings and Valuation

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This table compares Independent Bank Gr and Banco Bradesco’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Independent Bank Gr $349.20 million 5.69 $76.51 million $3.45 20.32
Banco Bradesco $46.46 billion 1.56 $4.59 billion $0.89 11.08

Banco Bradesco has higher revenue and earnings than Independent Bank Gr. Banco Bradesco is trading at a lower price-to-earnings ratio than Independent Bank Gr, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Independent Bank Gr has a beta of 1.24, suggesting that its share price is 24% more volatile than the S&P 500. Comparatively, Banco Bradesco has a beta of 1.84, suggesting that its share price is 84% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Independent Bank Gr and Banco Bradesco, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Independent Bank Gr 0 1 5 0 2.83
Banco Bradesco 0 1 3 0 2.75

Independent Bank Gr currently has a consensus target price of $72.00, indicating a potential upside of 2.71%. Banco Bradesco has a consensus target price of $12.40, indicating a potential upside of 25.76%. Given Banco Bradesco’s higher probable upside, analysts clearly believe Banco Bradesco is more favorable than Independent Bank Gr.

Dividends

Independent Bank Gr pays an annual dividend of $0.48 per share and has a dividend yield of 0.7%. Banco Bradesco pays an annual dividend of $0.06 per share and has a dividend yield of 0.6%. Independent Bank Gr pays out 13.9% of its earnings in the form of a dividend. Banco Bradesco pays out 6.7% 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 Bradesco has raised its dividend for 4 consecutive years.

Institutional & Insider Ownership

56.3% of Independent Bank Gr shares are owned by institutional investors. Comparatively, 2.6% of Banco Bradesco shares are owned by institutional investors. 7.7% of Independent Bank Gr shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Independent Bank Gr and Banco Bradesco’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Independent Bank Gr 21.91% 7.79% 1.10%
Banco Bradesco 9.87% 17.44% 1.58%

Summary

Independent Bank Gr beats Banco Bradesco on 9 of the 17 factors compared between the two stocks.

About Independent Bank Gr

Independent Bank Group, Inc. operates as the bank holding company for Independent Bank that provides a range of commercial banking products and services to businesses, professionals, and individuals in the United States. It offers various deposit products, including checking and savings accounts, demand accounts, money market accounts, and certificates of deposit, as well as individual retirement accounts. The company also provides commercial real estate loans; commercial construction, land, and land development loans; residential real estate loans; single family interim construction loans; commercial loans comprising SBA guaranteed loans, business term loans, equipment financing, and lines of credit and energy related loans; agricultural loans for farmers and ranchers; consumer loans, such as installment loans comprising loans to purchase cars, boats, and other recreational vehicles; and residential mortgages. In addition, it offers debit cards, online banking, mobile banking, eStatements, bank-by-mail, and direct deposit services; and business accounts and management services, including analyzed business checking, business savings, and treasury management services. As of December 31, 2017, the company operated 70 banking offices located in the Dallas/North Texas area, Austin/Central Texas area, and the Houston metropolitan area. Independent Bank Group, Inc. was founded in 2002 and is headquartered in McKinney, Texas.

About Banco Bradesco

Banco Bradesco S.A. provides banking and financial products and services to individuals, companies, and corporations and institutions. The company operates in two segments, Banking; and Insurance, Pension Plans and Capitalization Bond. It accepts demand and time deposits, checking and savings accounts, interbank deposits from financial institutions, and accounts for salary purposes. The company also offers loans comprising personal and short-term loans, vehicle financing, overdraft loans, and payroll-deductible loans; housing loans; government-funded long-term loans, such as BNDES onlending/FINAME; rural loans; and microcredit to middle- and low-income individuals, as well as small companies. In addition, it offers other corporate loans and advances, such as short-term loans; working capital loans; corporate overdraft loans; discounting trade receivables, promissory notes, checks, credit card and supplier receivables, etc.; financing for purchase and sale of goods and services; and investment lines for acquisition of assets and machinery. Further, the company provides life and personal accident, health, automobile, property, casualty, and liability insurance products, as well as insurance against miscellaneous events; reinsurance products; pension plans; and capitalization bonds. Additionally, it offers credit, debit, and pre-paid cards; cash management solutions; public authority solutions; asset management services; services related to capital markets and investment banking activities; intermediation and trading services; capital markets solutions; international banking services; import and export financing; consortiums; and receipts and payments solutions. As of December 31, 2016, the company operated through a network of 5,314 branches, 4,834 service centers and electronic in-company service centers, and 36,119 active ATMs in Brazil; and 3 branches internationally. Banco Bradesco S.A. was founded in 1943 and is headquartered in Osasco, Brazil.

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