Ameris Bancorp (NASDAQ: ABCB) and KeyCorp (NYSE:KEY) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, profitability, valuation, risk, analyst recommendations and institutional ownership.

Risk & Volatility

Ameris Bancorp has a beta of 1.29, meaning that its share price is 29% more volatile than the S&P 500. Comparatively, KeyCorp has a beta of 1.12, meaning that its share price is 12% more volatile than the S&P 500.

Dividends

Ameris Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 0.9%. KeyCorp pays an annual dividend of $0.38 per share and has a dividend yield of 2.1%. Ameris Bancorp pays out 17.1% of its earnings in the form of a dividend. KeyCorp pays out 38.8% 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. KeyCorp has raised its dividend for 6 consecutive years. KeyCorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

82.4% of Ameris Bancorp shares are owned by institutional investors. Comparatively, 80.8% of KeyCorp shares are owned by institutional investors. 3.6% of Ameris Bancorp shares are owned by insiders. Comparatively, 0.7% of KeyCorp 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.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Ameris Bancorp and KeyCorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ameris Bancorp 0 4 2 0 2.33
KeyCorp 2 9 14 0 2.48

Ameris Bancorp currently has a consensus price target of $49.20, indicating a potential upside of 11.82%. KeyCorp has a consensus price target of $20.26, indicating a potential upside of 11.84%. Given KeyCorp’s stronger consensus rating and higher possible upside, analysts plainly believe KeyCorp is more favorable than Ameris Bancorp.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ameris Bancorp $338.56 million 4.83 $86.96 million $2.34 18.80
KeyCorp $5.69 billion 3.46 $1.07 billion $0.98 18.49

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

Profitability

This table compares Ameris Bancorp and KeyCorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ameris Bancorp 22.66% 12.52% 1.27%
KeyCorp 16.62% 9.88% 1.01%

Summary

Ameris Bancorp beats KeyCorp on 10 of the 17 factors compared between the two stocks.

Ameris Bancorp Company Profile

Ameris Bancorp is a financial holding company. The Company’s business is conducted through its banking subsidiary, Ameris Bank (the Bank), which provides a range of banking services to its retail and commercial customers. The Company operates through four segments: the Banking Division, the Retail Mortgage Division, the Warehouse Lending Division and the SBA Division. The Banking Division is engaged in the delivery of financial services, which include commercial loans, consumer loans and deposit accounts. The Retail Mortgage Division is engaged in the origination, sales and servicing of one- to four-family residential mortgage loans. The Warehouse Lending Division is engaged in the origination and servicing of warehouse lines to other businesses that are secured by underlying one- to four-family residential mortgage loans. The SBA Division is engaged in the origination, sales and servicing of small business administration (SBA) loans.

KeyCorp Company Profile

KeyCorp is a bank holding company. The Company is a bank-based financial services company. The Company operates through its subsidiary, KeyBank National Association (KeyBank), which is engaged in providing banking services. Through KeyBank and other subsidiaries, it provides a range of retail and commercial banking, commercial leasing, investment management, consumer finance, and investment banking products and services to individual, corporate and institutional clients. Its segments include Key Community Bank and Key Corporate Bank. Key Community Bank serves individuals and small to mid-sized businesses by offering a range of deposit, investment, lending, credit card, and personalized wealth management products and business advisory services. Key Corporate Bank is a full-service corporate and investment bank focused on serving the needs of middle market clients in industry sectors, which include consumer, energy, healthcare, industrial, public sector, real estate and technology.

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