Comparing City (NASDAQ:CHCO) & Trustmark (NASDAQ:TRMK)

City (NASDAQ:CHCO) and Trustmark (NASDAQ:TRMK) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, dividends, earnings, profitability, valuation, institutional ownership and risk.

Valuation & Earnings

This table compares City and Trustmark”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
City	$398.98 million	4.48	$130.49 million	$9.08	13.96
Trustmark	$1.12 billion	2.30	$224.13 million	$3.78	11.68

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

Volatility & Risk

City has a beta of 0.49, meaning that its share price is 51% less volatile than the S&P 500. Comparatively, Trustmark has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for City and Trustmark, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
City	0	5	1	0	2.17
Trustmark	0	5	2	0	2.29

City presently has a consensus target price of $134.25, suggesting a potential upside of 5.89%. Trustmark has a consensus target price of $44.75, suggesting a potential upside of 1.36%. Given City’s higher possible upside, equities analysts plainly believe City is more favorable than Trustmark.

Profitability

This table compares City and Trustmark’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
City	32.72%	16.58%	1.96%
Trustmark	20.12%	10.74%	1.20%

Dividends

City pays an annual dividend of $3.48 per share and has a dividend yield of 2.7%. Trustmark pays an annual dividend of $1.00 per share and has a dividend yield of 2.3%. City pays out 38.3% of its earnings in the form of a dividend. Trustmark pays out 26.5% 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. City has raised its dividend for 6 consecutive years and Trustmark has raised its dividend for 1 consecutive years. City is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

72.4% of City shares are held by institutional investors. Comparatively, 67.6% of Trustmark shares are held by institutional investors. 1.8% of City shares are held by insiders. Comparatively, 1.7% of Trustmark shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

City beats Trustmark on 11 of the 17 factors compared between the two stocks.

About City

City Holding Company operates as a holding company for City National Bank of West Virginia that provides various banking, trust, and investment management, and other financial solutions in the United States. The company offers checking, savings, and money market accounts, as well as certificates of deposit and individual retirement accounts. It also provides commercial and industrial loans that consist of loans to corporate and other legal entity borrowers primarily in small to mid-size industrial and commercial companies; commercial real estate loans comprising commercial mortgages, which are secured by nonresidential and multi-family residential properties; residential real estate loans to consumers for the purchase or refinance of residence; first-priority home equity loans; home equity lines of credit; amortized home equity loans; consumer loans that are secured and unsecured by automobiles, boats, recreational vehicles, certificates of deposit, and other personal property; and demand deposit account overdrafts, as well as owner-occupied real estate and construction, land development, and lines of credit. In addition, the company offers mortgage banking services, including fixed and adjustable-rate mortgages, construction financing, land loans, production of conventional and government-insured mortgages, secondary marketing, and mortgage servicing. Further, it provides deposit services for commercial customers comprising treasury management, lockbox, and other cash management services; merchant credit card services; wealth management, trust, investment, and custodial services for commercial and individual customers; and corporate trust and institutional custody, financial and estate planning, and retirement plan services, as well as automated-teller-machine, interactive-teller-machine, mobile banking, interactive voice response systems, and credit and debit card services. City Holding Company was founded in 1957 and is headquartered in Charleston, West Virginia.

About Trustmark

Trustmark Corporation operates as the bank holding company for Trustmark National Bank that provides banking and other financial solutions to individuals and corporate institutions in the United States. The company operates through three segments: General Banking, Wealth Management, and Insurance. It offers checking, savings, and money market accounts; certificates of deposits and individual retirement accounts; financing for commercial and industrial projects, income-producing commercial real estate, owner-occupied real estate, and construction and land development; and installment and real estate loans, and lines of credit, as well as treasury management services. The company also provides mortgage banking services, including construction financing, production of conventional and government-insured mortgages, and secondary marketing and mortgage servicing. In addition, it provides wealth management and trust services, such as administration of personal trusts and estates; management of investment accounts for individuals, employee benefit plans, and charitable foundations; and corporate trust and institutional custody, securities brokerage, financial and estate planning, retirement plan, and investment management services. Further, the company offers business insurance products and services for medical professionals, construction, manufacturing, hospitality, real estate, and group life and health plans; and life and health insurance, and personal line policies for individual customers. Trustmark Corporation was founded in 1889 and is headquartered in Jackson, Mississippi.