VersaBank (NASDAQ:VBNK) and Macro Bank (NYSE:BMA) Head to Head Analysis

VersaBank (NASDAQ:VBNK) and Macro Bank (NYSE:BMA) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, dividends, risk and analyst recommendations.

Profitability

This table compares VersaBank and Macro Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
VersaBank	10.03%	7.70%	0.73%
Macro Bank	4.99%	6.85%	1.66%

Dividends

VersaBank pays an annual dividend of $0.07 per share and has a dividend yield of 0.4%. Macro Bank pays an annual dividend of $4.89 per share and has a dividend yield of 6.9%. VersaBank pays out 10.0% of its earnings in the form of a dividend. Macro Bank pays out 148.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility and Risk

VersaBank has a beta of 1.11, meaning that its share price is 11% more volatile than the S&P 500. Comparatively, Macro Bank has a beta of 1.36, meaning that its share price is 36% more volatile than the S&P 500.

Valuation & Earnings

This table compares VersaBank and Macro Bank”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
VersaBank	$133.33 million	4.13	$20.32 million	$0.70	24.44
Macro Bank	$4.72 billion	0.96	$231.60 million	$3.29	21.54

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

Institutional and Insider Ownership

56.9% of VersaBank shares are held by institutional investors. 5.3% of VersaBank shares are held by insiders. Comparatively, 18.3% of Macro Bank 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.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for VersaBank and Macro Bank, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
VersaBank	0	2	2	0	2.50
Macro Bank	1	1	6	0	2.63

VersaBank presently has a consensus price target of $13.00, suggesting a potential downside of 24.02%. Macro Bank has a consensus price target of $103.60, suggesting a potential upside of 46.19%. Given Macro Bank’s stronger consensus rating and higher probable upside, analysts plainly believe Macro Bank is more favorable than VersaBank.

Summary

Macro Bank beats VersaBank on 10 of the 16 factors compared between the two stocks.

About VersaBank

VersaBank provides various banking products and services in Canada and the United States. It offers deposit products, such as web-based chequing accounts, guaranteed investment certificates, registered retirement savings plans, and tax-free savings accounts, as well as deposit insurance products. The company also provides lending services, including point of sale financing that covers purchasing loan and lease receivables from finance companies operating in various industries; commercial banking services comprising commercial real estate, public sector/infrastructure financing, and condominium financing; and residential mortgages. In addition, it offers cybersecurity services. The company was formerly known as Pacific & Western Bank of Canada and changed its name to VersaBank in May 2016. VersaBank was incorporated in 1979 and is headquartered in London, Canada.

About Macro Bank

Banco Macro S.A. provides various banking products and services to retail and corporate customers in Argentina. It offers various retail banking products and services, such as savings and checking accounts, time deposits, credit and debit cards, consumer finance loans, mortgage loans, automobile loans, overdrafts, credit-related services, home and car insurance coverage, tax collection, utility payments, automated teller machines, and money transfers. The company also provides personal loans, document discounts, residential mortgages, overdrafts, pledged loans, and credit card loans to retail customers. In addition, it offers corporate banking products and services, including deposits, lending, check cashing advances and factoring, guaranteed loans, credit lines for financing foreign trade, and cash management services; and trust, payroll, and financial agency services, as well as corporate credit cards and other specialty products; and working capital facilities, credit for investment projects, and leasing and foreign trade transactions. Further, the company provides transaction services, such as cash management, collection services, payments to suppliers, payroll services, foreign exchange transactions, and foreign trade services; information services comprising Datanet and Interpymes services to corporate customers; and Internet and mobile banking services. Additionally, it offers short-term and medium-to-long-term corporate lending products. Banco Macro S.A. was incorporated in 1966 and is headquartered in Buenos Aires, Argentina.