Analyzing JPMorgan Chase & Co. (NYSE:JPM) & SmartFinancial (NASDAQ:SMBK)

JPMorgan Chase & Co. (NYSE:JPM) and SmartFinancial (NASDAQ:SMBK) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, valuation, analyst recommendations, dividends, risk, institutional ownership and earnings.

Profitability

This table compares JPMorgan Chase & Co. and SmartFinancial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
JPMorgan Chase & Co.	21.86%	18.23%	1.33%
SmartFinancial	12.67%	7.33%	0.71%

Analyst Ratings

This is a breakdown of current recommendations and price targets for JPMorgan Chase & Co. and SmartFinancial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
JPMorgan Chase & Co.	0	11	16	1	2.64
SmartFinancial	0	4	2	1	2.57

JPMorgan Chase & Co. currently has a consensus target price of $359.96, indicating a potential upside of 1.86%. SmartFinancial has a consensus target price of $50.42, indicating a potential downside of 1.42%. Given JPMorgan Chase & Co.’s stronger consensus rating and higher possible upside, research analysts plainly believe JPMorgan Chase & Co. is more favorable than SmartFinancial.

Earnings and Valuation

This table compares JPMorgan Chase & Co. and SmartFinancial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
JPMorgan Chase & Co.	$194.91 billion	4.82	$57.05 billion	$23.34	15.14
SmartFinancial	$210.19 million	4.16	$36.14 million	$3.39	15.09

JPMorgan Chase & Co. has higher revenue and earnings than SmartFinancial. SmartFinancial is trading at a lower price-to-earnings ratio than JPMorgan Chase & Co., indicating that it is currently the more affordable of the two stocks.

Dividends

JPMorgan Chase & Co. pays an annual dividend of $6.00 per share and has a dividend yield of 1.7%. SmartFinancial pays an annual dividend of $0.36 per share and has a dividend yield of 0.7%. JPMorgan Chase & Co. pays out 25.7% of its earnings in the form of a dividend. SmartFinancial pays out 10.6% 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. JPMorgan Chase & Co. has increased its dividend for 15 consecutive years and SmartFinancial has increased its dividend for 3 consecutive years. JPMorgan Chase & Co. is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

71.6% of JPMorgan Chase & Co. shares are owned by institutional investors. Comparatively, 58.8% of SmartFinancial shares are owned by institutional investors. 0.4% of JPMorgan Chase & Co. shares are owned by company insiders. Comparatively, 6.9% of SmartFinancial shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

JPMorgan Chase & Co. has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500. Comparatively, SmartFinancial has a beta of 0.68, meaning that its stock price is 32% less volatile than the S&P 500.

Summary

JPMorgan Chase & Co. beats SmartFinancial on 14 of the 17 factors compared between the two stocks.

About JPMorgan Chase & Co.

JPMorgan Chase & Co. is a financial holding company, which engages in the provision of financial and investment banking services. It focuses on investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing, and asset management. It operates through the following segments: Consumer and Community Banking (CCB), Commercial and Investment Bank (CIB), Asset and Wealth Management (AWM), and Corporate. The CCB segment originates and services mortgage loans. The CIB segment makes markets and services clients across fixed income, foreign exchange, equities, and commodities. The AWM segment provides initial capital investments in products such as mutual funds and capital invested alongside third-party investors. The Corporate segment manages its liquidity, funding, capital, structural interest rate, and foreign exchange risks. The company was founded in 1799 and is headquartered in New York, NY.

About SmartFinancial

SmartFinancial, Inc. operates as the bank holding company for SmartBank that provides various financial services to individuals and corporate customers in Tennessee, Alabama, and Florida. It operates through Commercial Real Estate, Consumer Real Estate, Construction and Land Development, Commercial and Industrial, Leases, and Consumer and Other segments. The company offers noninterest-bearing and interest-bearing checking, interest-bearing demand, savings, money market, time deposit, individual retirement accounts, as well as certificates of deposit. It also provides commercial and residential real estate, consumer real estate, and construction and land development loans; commercial and financial loans and leases; commercial business and mortgage loans; and direct consumer installment, educational, agriculture, and other revolving credit loans; equipment financing, heavy equipment, semis, and trailers loans and leases to small and mid-size companies; letters of credit; and overdraft facilities. In addition, the company offers wealth management, insurance, mortgage origination, and internet and mobile banking services. SmartFinancial, Inc. is headquartered in Knoxville, Tennessee.