Comparing Westamerica Bancorporation (NASDAQ:WABC) and Synovus Financial (NYSE:SNV)

Westamerica Bancorporation (NASDAQ:WABC) and Synovus Financial (NYSE:SNV) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, risk, institutional ownership, dividends, profitability, valuation and analyst recommendations.

Dividends

Westamerica Bancorporation pays an annual dividend of $1.76 per share and has a dividend yield of 3.6%. Synovus Financial pays an annual dividend of $1.52 per share and has a dividend yield of 3.9%. Westamerica Bancorporation pays out 29.7% of its earnings in the form of a dividend. Synovus Financial pays out 52.1% 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. Westamerica Bancorporation has raised its dividend for 32 consecutive years and Synovus Financial has raised its dividend for 2 consecutive years.

Institutional and Insider Ownership

81.9% of Westamerica Bancorporation shares are held by institutional investors. Comparatively, 83.8% of Synovus Financial shares are held by institutional investors. 4.4% of Westamerica Bancorporation shares are held by insiders. Comparatively, 0.8% of Synovus Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Westamerica Bancorporation and Synovus Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Westamerica Bancorporation	48.35%	21.99%	2.42%
Synovus Financial	13.29%	12.93%	0.94%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Westamerica Bancorporation and Synovus Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Westamerica Bancorporation	0	2	0	0	2.00
Synovus Financial	0	7	9	0	2.56

Westamerica Bancorporation currently has a consensus price target of $53.50, indicating a potential upside of 10.93%. Synovus Financial has a consensus price target of $41.50, indicating a potential upside of 5.76%. Given Westamerica Bancorporation’s higher probable upside, equities research analysts clearly believe Westamerica Bancorporation is more favorable than Synovus Financial.

Risk and Volatility

Westamerica Bancorporation has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500. Comparatively, Synovus Financial has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500.

Earnings & Valuation

This table compares Westamerica Bancorporation and Synovus Financial’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Westamerica Bancorporation	$319.79 million	4.02	$161.77 million	$5.92	8.15
Synovus Financial	$2.11 billion	2.72	$543.71 million	$2.92	13.44

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

Summary

Westamerica Bancorporation beats Synovus Financial on 9 of the 17 factors compared between the two stocks.

About Westamerica Bancorporation

Westamerica Bancorporation operates as a bank holding company for the Westamerica Bank that provides various banking products and services to individual and commercial customers. The company accepts various deposit products, including retail savings and checking accounts, as well as certificates of deposit. Its loan portfolio includes commercial, commercial and residential real estate, real estate construction, and consumer installment loans, as well as indirect automobile loans. The company was formerly known as Independent Bankshares Corporation and changed its name to Westamerica Bancorporation in 1983. The company was founded in 1884 and is headquartered in San Rafael, California.

About Synovus Financial

Synovus Financial Corp. operates as the bank holding company for Synovus Bank that provides commercial and consumer banking products and services. It operates through four segments: Community Banking, Wholesale Banking, Consumer Banking, and Financial Management Services. The company's commercial banking services include treasury and asset management, capital market, and institutional trust services, as well as commercial, financial, and real estate lending services. Its consumer banking services comprise accepting customary types of demand and savings deposits accounts; mortgage, installment, and other consumer loans; investment and brokerage services; safe deposit services; automated banking services; automated fund transfers; internet-based banking services; and bank credit and debit card services, including Visa and MasterCard services. The company also offers various other financial services, including portfolio management for fixed-income securities, investment banking, execution of securities transactions as a broker/dealer, trust management, and financial planning services, as well as provides individual investment advice on equity and other securities. The company was founded in 1888 and is headquartered in Columbus, Georgia.