Critical Survey: Sumitomo Mitsui Trust (OTCMKTS:SUTNY) versus Citizens & Northern (NASDAQ:CZNC)

Sumitomo Mitsui Trust (OTCMKTS:SUTNY) and Citizens & Northern (NASDAQ:CZNC) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, earnings, profitability, institutional ownership, dividends and risk.

Valuation and Earnings

This table compares Sumitomo Mitsui Trust and Citizens & Northern”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sumitomo Mitsui Trust	$19.82 billion	1.42	$1.99 billion	$0.43	11.84
Citizens & Northern	$170.03 million	2.94	$23.43 million	$1.48	18.86

Sumitomo Mitsui Trust has higher revenue and earnings than Citizens & Northern. Sumitomo Mitsui Trust is trading at a lower price-to-earnings ratio than Citizens & Northern, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

30.8% of Citizens & Northern shares are held by institutional investors. 4.7% of Citizens & Northern 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 Recommendations

This is a summary of current recommendations and price targets for Sumitomo Mitsui Trust and Citizens & Northern, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sumitomo Mitsui Trust	0	1	0	0	2.00
Citizens & Northern	0	2	1	0	2.33

Citizens & Northern has a consensus price target of $23.50, indicating a potential downside of 15.83%. Given Citizens & Northern’s stronger consensus rating and higher probable upside, analysts clearly believe Citizens & Northern is more favorable than Sumitomo Mitsui Trust.

Dividends

Sumitomo Mitsui Trust pays an annual dividend of $0.10 per share and has a dividend yield of 2.0%. Citizens & Northern pays an annual dividend of $1.20 per share and has a dividend yield of 4.3%. Sumitomo Mitsui Trust pays out 23.3% of its earnings in the form of a dividend. Citizens & Northern pays out 81.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Sumitomo Mitsui Trust and Citizens & Northern’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sumitomo Mitsui Trust	11.81%	10.45%	0.45%
Citizens & Northern	13.28%	9.54%	1.04%

Summary

Citizens & Northern beats Sumitomo Mitsui Trust on 11 of the 15 factors compared between the two stocks.

About Sumitomo Mitsui Trust

Sumitomo Mitsui Trust Holdings, Inc. operates as a trust bank in Japan and internationally. It offers supervising services for management strategies, and financial and human resource management; and general affairs, business process, corporate administration, operational process, risk, and compliance management services; and internal auditing services. The company also provides real estate brokerage, investment management, and investment advisory services for individual and corporate clients; high-level professional consulting services; loan guarantees and payment collection agency services; issuing credit cards; internet banking; securities administration and credit card services; and advanced financial instruments, such as leasing and credit services, and credit card financing services, as well as mortgage loans and managing private equity funds and related advisory services. In addition, it offers back-office services, such as business management and system administration for stock transfer agencies; clerical works, including managing shareholders registry and special accounts; custody and fund administration services; stock transfer agency services; asset management services; and retail total solution, marketing, and fiduciary services, as well as system development and maintenance. Further, the company provides facilities management, clerical work outsourcing, and leasing of buildings; consulting services related to digital transformation, data-analytics, and a range of research and studies; and evaluation of mutual funds, discretionary investment funds, and insurance products, as well as engages in trustee and temporary staffing businesses. The company was formerly known as Chuo Mitsui Trust Holdings, Inc. and changed its name to Sumitomo Mitsui Trust Holdings, Inc. in 2011. Sumitomo Mitsui Trust Holdings, Inc. was founded in 1924 and is headquartered in Tokyo, Japan.

About Citizens & Northern

Citizens & Northern Corp. is a holding company, which engages in community banking. It provides a full range of banking and mortgage services to individual and corporate customers in North Central Pennsylvania and Southern New York State. The firm’s lending products include mortgage loans, commercial loans, and consumer loans. Its deposit products include various types of checking accounts, passbook and statement savings, money market accounts, interest checking accounts, individual retirement accounts, and certificates of deposit. The company was founded in 1864 and is headquartered in Wellsboro, PA.