Shinhan Financial Group (NYSE:SHG) vs. BancFirst (NASDAQ:BANF) Financial Contrast

Shinhan Financial Group (NYSE:SHG) and BancFirst (NASDAQ:BANF) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, risk, dividends, valuation and earnings.

Volatility and Risk

Shinhan Financial Group has a beta of 0.94, indicating that its stock price is 6% less volatile than the S&P 500. Comparatively, BancFirst has a beta of 1.05, indicating that its stock price is 5% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Shinhan Financial Group and BancFirst, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shinhan Financial Group	0	0	0	0	0.00
BancFirst	1	2	0	0	1.67

BancFirst has a consensus target price of $113.33, indicating a potential downside of 2.80%. Given BancFirst’s stronger consensus rating and higher probable upside, analysts plainly believe BancFirst is more favorable than Shinhan Financial Group.

Valuation & Earnings

This table compares Shinhan Financial Group and BancFirst”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shinhan Financial Group	$7,044.37 billion	0.00	$3.49 billion	$6.37	5.21
BancFirst	$809.34 million	4.77	$216.35 million	$6.44	18.11

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

Dividends

Shinhan Financial Group pays an annual dividend of $1.20 per share and has a dividend yield of 3.6%. BancFirst pays an annual dividend of $1.84 per share and has a dividend yield of 1.6%. Shinhan Financial Group pays out 18.8% of its earnings in the form of a dividend. BancFirst pays out 28.6% 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. BancFirst has increased its dividend for 31 consecutive years. Shinhan Financial Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Shinhan Financial Group and BancFirst’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shinhan Financial Group	12.21%	7.34%	0.59%
BancFirst	23.52%	14.21%	1.68%

Institutional and Insider Ownership

7.8% of Shinhan Financial Group shares are owned by institutional investors. Comparatively, 51.7% of BancFirst shares are owned by institutional investors. 1.0% of Shinhan Financial Group shares are owned by insiders. Comparatively, 33.9% of BancFirst shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

BancFirst beats Shinhan Financial Group on 12 of the 16 factors compared between the two stocks.

About Shinhan Financial Group

Shinhan Financial Group Co., Ltd. provides financial products and services in South Korea and internationally. The company operates through six segments: Banking, Credit Card, Securities, Insurance, Credit, and Others. It offers retail banking services, including demand, savings, and fixed deposit-taking; checking accounts; mortgage and home equity, and retail lending; electronic banking and automatic teller machines (ATM); and bill paying, payroll and check-cashing, currency exchange, and wire fund transfer services. The company also provides corporate banking services, such as investment banking, real estate financing, overseas real estate and development project financing, infrastructure and structured financing, equity/venture investments, mergers and acquisitions consulting; securitization and derivatives services comprising securities and derivative products, and foreign exchange trading; business expansion financing and consulting services; and working capital loans and facilities loans. In addition, it is involved in treasury and investment activities in international capital markets consisting of foreign currency-denominated securities trading, foreign exchange trading and services, trade-related financial services, international factoring services, and foreign banking operations. Further, the company offers real estate trust, investment advisory, venture business investment, life and non-life insurance, trust account management, securities brokerage, and asset management services, as well as leasing and equipment financing, savings banking, loan collection and credit reporting, collective investment administration, private equity investment, and financial system development services. Additionally, it provides transaction history inquiries and fund transfers, opening letters of credit, trade finance, payment and collection management, sales and acquisition settlement, business-to-business settlement, sweeping, pooling, ERP interface, host-to-host banking, SWIFT SCORE, and cash and liquidity management service. Shinhan Financial Group Co., Ltd. was founded in 1982 and is headquartered in Seoul, South Korea.

About BancFirst

BancFirst Corporation operates as the bank holding company for BancFirst that provides a range of commercial banking services to retail customers, and small to medium-sized businesses. The company operates through BancFirst Metropolitan Banks, BancFirst Community Banks, Pegasus, Worthington, and Other Financial Services segments. It offers checking accounts, negotiable order of withdrawal accounts, savings accounts, money market accounts, sweep accounts, club accounts, individual retirement accounts, and certificates of deposit, as well as overdraft protection and auto draft services. The company also provides commercial and agricultural non-real estate loans for working capital, facilities acquisition or expansion, purchase of equipment, and other needs; lending services that include private banking, energy, commercial and residential real estate, and commercial and industrial loans; and loans to finance purchases of consumer goods, such as automobiles, boats, household goods, vacations, and education. In addition, it engages in the investment management and administration of trusts for individuals, corporations, and employee benefit plans, as well as bond trustee and paying agent business for various Oklahoma municipalities and governmental entities; and provision of item processing, research, and other correspondent banking services to financial institutions and governmental units. Further, the company provides insurance agency services; depository and funds transfer, collection, safe deposit box, cash management, and other services. It serves customers in non-metropolitan trade centers and cities in the metropolitan statistical areas of Oklahoma. The company was formerly known as United Community Corporation and changed its name to BancFirst Corporation in November 1988. BancFirst Corporation was incorporated in 1984 and is headquartered in Oklahoma City, Oklahoma.