Comparing Hanmi Financial (NASDAQ:HAFC) & United Bankshares (NASDAQ:UBSI)

Hanmi Financial (NASDAQ:HAFC) and United Bankshares (NASDAQ:UBSI) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, valuation, dividends, analyst recommendations, profitability, institutional ownership and earnings.

Valuation & Earnings

This table compares Hanmi Financial and United Bankshares”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hanmi Financial	$444.90 million	2.15	$76.09 million	$2.97	10.85
United Bankshares	$1.82 billion	3.52	$464.60 million	$3.67	12.81

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

Analyst Ratings

This is a summary of recent ratings and recommmendations for Hanmi Financial and United Bankshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hanmi Financial	0	4	2	0	2.33
United Bankshares	0	4	3	0	2.43

Hanmi Financial presently has a consensus price target of $33.00, indicating a potential upside of 2.39%. United Bankshares has a consensus price target of $47.80, indicating a potential upside of 1.66%. Given Hanmi Financial’s higher possible upside, research analysts clearly believe Hanmi Financial is more favorable than United Bankshares.

Volatility & Risk

Hanmi Financial has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500. Comparatively, United Bankshares has a beta of 0.7, meaning that its stock price is 30% less volatile than the S&P 500.

Dividends

Hanmi Financial pays an annual dividend of $1.12 per share and has a dividend yield of 3.5%. United Bankshares pays an annual dividend of $1.52 per share and has a dividend yield of 3.2%. Hanmi Financial pays out 37.7% of its earnings in the form of a dividend. United Bankshares pays out 41.4% 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. Hanmi Financial has raised its dividend for 1 consecutive years and United Bankshares has raised its dividend for 26 consecutive years. Hanmi Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Hanmi Financial and United Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hanmi Financial	19.82%	11.20%	1.13%
United Bankshares	27.97%	9.39%	1.53%

Institutional and Insider Ownership

88.7% of Hanmi Financial shares are owned by institutional investors. Comparatively, 70.8% of United Bankshares shares are owned by institutional investors. 2.1% of Hanmi Financial shares are owned by company insiders. Comparatively, 3.2% of United Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

United Bankshares beats Hanmi Financial on 11 of the 17 factors compared between the two stocks.

About Hanmi Financial

Hanmi Financial Corporation operates as the holding company for Hanmi Bank that provides business banking products and services in the United States. It offers various deposit products, including noninterest-bearing checking accounts, savings accounts, negotiable order of withdrawal accounts, money market accounts, and certificates of deposit. The company also provides real estate loans, such as commercial property, construction, and residential property loans; and commercial and industrial loans, such as commercial term loans and commercial lines of credit; and international finance and trade services and products, such as letters of credit, and import and export financing. In addition, it offers small business administration loans for business purposes, which comprise owner-occupied commercial real estate, business acquisitions, start-ups, franchise financing, working capital, improvements and renovations, inventory and equipment, and debt-refinancing, as well as equipment lease financing. The company was founded in 1982 and is headquartered in Los Angeles, California.

About United Bankshares

United Bankshares, Inc., through its subsidiaries, primarily provides commercial and retail banking products and services in the United States. It operates through two segments, Community Banking and Mortgage Banking. The company accepts checking, savings, and time and money market accounts; individual retirement accounts; and demand deposits, statement and special savings, and NOW accounts. Its loan products include commercial loans and leases to small to mid-size industrial and commercial companies; construction and real estate loans, such as commercial and residential mortgages, and loans secured by owner-occupied real estate; personal, student, credit card receivables, personal, commercial, and floor plan loans; and home equity loans. In addition, the company provides credit cards; safe deposit boxes, wire transfers, and other banking products and services; investment and security services; services to correspondent banks, including buying and selling federal funds; automated teller machine services; and internet and telephone banking services. Further, it offers community banking services, such as asset management, real property title insurance, financial planning, mortgage banking, and brokerage services, as well as investment management and retirement planning services. United Bankshares, Inc. was incorporated in 1982 and is headquartered in Charleston, West Virginia.