Wells Fargo & Co (NYSE:WFC) and Huntington Bancshares (NASDAQ:HBAN) are both large-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, analyst recommendations, valuation, institutional ownership, dividends and profitability.

Insider and Institutional Ownership

72.2% of Wells Fargo & Co shares are held by institutional investors. Comparatively, 79.0% of Huntington Bancshares shares are held by institutional investors. 0.1% of Wells Fargo & Co shares are held by company insiders. Comparatively, 1.2% of Huntington Bancshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent recommendations for Wells Fargo & Co and Huntington Bancshares, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Wells Fargo & Co 0 12 7 0 2.37
Huntington Bancshares 0 7 3 0 2.30

Wells Fargo & Co presently has a consensus price target of $55.91, suggesting a potential upside of 17.50%. Huntington Bancshares has a consensus price target of $16.10, suggesting a potential upside of 18.30%. Given Huntington Bancshares’ higher possible upside, analysts plainly believe Huntington Bancshares is more favorable than Wells Fargo & Co.

Dividends

Wells Fargo & Co pays an annual dividend of $1.80 per share and has a dividend yield of 3.8%. Huntington Bancshares pays an annual dividend of $0.56 per share and has a dividend yield of 4.1%. Wells Fargo & Co pays out 41.1% of its earnings in the form of a dividend. Huntington Bancshares pays out 46.7% 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. Wells Fargo & Co has raised its dividend for 7 consecutive years and Huntington Bancshares has raised its dividend for 6 consecutive years.

Profitability

This table compares Wells Fargo & Co and Huntington Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Wells Fargo & Co 22.59% 13.37% 1.25%
Huntington Bancshares 26.43% 13.93% 1.31%

Risk and Volatility

Wells Fargo & Co has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500. Comparatively, Huntington Bancshares has a beta of 1.35, suggesting that its stock price is 35% more volatile than the S&P 500.

Valuation and Earnings

This table compares Wells Fargo & Co and Huntington Bancshares’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Wells Fargo & Co $101.06 billion 2.30 $22.39 billion $4.38 10.86
Huntington Bancshares $5.27 billion 2.71 $1.39 billion $1.20 11.34

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

Summary

Huntington Bancshares beats Wells Fargo & Co on 10 of the 17 factors compared between the two stocks.

Wells Fargo & Co Company Profile

Wells Fargo & Company, a diversified financial services company, provides retail, commercial, and corporate banking services to individuals, businesses, and institutions. The company's Community Banking segment offers checking and savings accounts; credit and debit cards; and automobile, student, mortgage, home equity, and small business loans. Its Wholesale Banking segment offers commercial loans and lines of credit, letters of credit, asset-based lending, equipment leasing, international trade facilities, trade financing, collection, foreign exchange, treasury management, merchant payment processing, institutional fixed-income sales, commodity and equity risk management, corporate trust fiduciary and agency, and investment banking services, as well as online/electronic products. This segment also provides construction, and land acquisition and development loans; secured and unsecured lines of credit; interim financing arrangements; rehabilitation loans; affordable housing loans and letters of credit; loans for securitization; and real estate and mortgage brokerage services. The company's Wealth and Investment Management segment offers financial planning, private banking, credit, and investment management and fiduciary services, as well as retirement and trust services. As of February 7, 2019, it operated through 7,800 locations, 13,000 ATMs, and the Internet and mobile banking, as well as has offices in 37 countries and territories. Wells Fargo & Company was founded in 1852 and is headquartered in San Francisco, California.

Huntington Bancshares Company Profile

Huntington Bancshares Incorporated operates as a holding company for The Huntington National Bank that provides commercial, small business, consumer, and mortgage banking services. The company operates through four business segments: Consumer and Business Banking, Commercial Banking, Vehicle Finance, and Regional Banking and The Huntington Private Client Group (RBHPCG). The Consumer and Business Banking segment offers financial products and services, such as checking accounts, savings accounts, money market accounts, certificates of deposit, consumer loans, mortgage loans, credit cards, and small business loans, as well as investment products. It also provides insurance, interest rate risk protection, foreign exchange, and treasury management services, as well as online, mobile, and telephone banking services. The Commercial Banking segment offers banking solutions and asset finance services; corporate risk management services; institutional sales, trading, and underwriting services; institutional corporate banking services; treasury management services; and other financing solutions, as well as lends real estate developers, REITs, and other customers. The Vehicle Finance segment provides financing to consumers for the purchase of automobiles, light-duty trucks, recreational vehicles, and marine craft at franchised and other select dealerships, as well as to franchised dealerships for the acquisition of new and used inventory. The RBHPCG segment provides deposits, lending, banking, wealth management, investment and portfolio management, fiduciary administration, trust, retirement plan, and institutional and mutual fund custody services. As of December 31, 2018, the company operated through 944 branches located in Ohio, Michigan, Pennsylvania, Indiana, Illinois, Wisconsin, West Virginia, and Kentucky; and 10 private client group offices. Huntington Bancshares Incorporated was founded in 1866 and is headquartered in Columbus, Ohio.

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