Comparing International Bancshares (NASDAQ:IBOC) and Home BancShares (NYSE:HOMB)

International Bancshares (NASDAQ:IBOC) and Home BancShares (NYSE:HOMB) are both mid-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, risk, analyst recommendations, profitability, valuation and earnings.

Profitability

This table compares International Bancshares and Home BancShares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
International Bancshares	38.83%	12.67%	2.47%
Home BancShares	32.36%	11.14%	2.08%

Volatility & Risk

International Bancshares has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500. Comparatively, Home BancShares has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500.

Institutional and Insider Ownership

65.9% of International Bancshares shares are owned by institutional investors. Comparatively, 67.3% of Home BancShares shares are owned by institutional investors. 13.1% of International Bancshares shares are owned by company insiders. Comparatively, 6.4% of Home BancShares shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for International Bancshares and Home BancShares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
International Bancshares	0	0	1	0	3.00
Home BancShares	0	5	5	0	2.50

International Bancshares presently has a consensus target price of $85.00, indicating a potential upside of 24.09%. Home BancShares has a consensus target price of $32.57, indicating a potential upside of 6.18%. Given International Bancshares’ stronger consensus rating and higher possible upside, analysts plainly believe International Bancshares is more favorable than Home BancShares.

Dividends

International Bancshares pays an annual dividend of $1.46 per share and has a dividend yield of 2.1%. Home BancShares pays an annual dividend of $0.92 per share and has a dividend yield of 3.0%. International Bancshares pays out 22.0% of its earnings in the form of a dividend. Home BancShares pays out 37.7% 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. International Bancshares has increased its dividend for 16 consecutive years and Home BancShares has increased its dividend for 15 consecutive years.

Earnings and Valuation

This table compares International Bancshares and Home BancShares”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
International Bancshares	$859.07 million	4.96	$412.29 million	$6.63	10.33
Home BancShares	$1.48 billion	4.15	$475.44 million	$2.44	12.57

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

Summary

International Bancshares beats Home BancShares on 10 of the 17 factors compared between the two stocks.

About International Bancshares

International Bancshares Corporation, a financial holding company, provides commercial and retail banking services in Texas and the State of Oklahoma. It accepts checking and saving deposits; and offers commercial, real estate, personal, home improvement, automobile, and other installment and term loans. The company also provides international banking services, including letters of credit, commercial and industrial loans, and foreign exchange services. In addition, it offers other banking related services, such as credit cards, safety deposit boxes, collection, notary public, escrow, drive up and walk up facilities, and other customary banking services; and Internet banking services, as well as securities products through third party providers. The company was founded in 1966 and is headquartered in Laredo, Texas.

About Home BancShares

Home Bancshares, Inc. (Conway, AR) operates as the bank holding company for Centennial Bank that provides commercial and retail banking, and related financial services to businesses, real estate developers and investors, individuals, and municipalities. Its deposit products include checking, savings, and money market accounts, as well as certificates of deposit. The company's loan portfolio comprises non-farm/non-residential real estate, construction/land development, residential mortgage, consumer, agricultural, and commercial and industrial loans. It provides internet banking, mobile banking and voice response information, cash management, overdraft protection, direct deposit, and automatic account transfer services, as well as safe deposit boxes and the United States savings bonds. In addition, the company writes policies for commercial and personal lines of business, including insurance for property, casualty, life, health, and employee benefits. It operates through branches in Arkansas, Florida, Alabama, Texas, and New York City. Home Bancshares, Inc. (Conway, AR) was founded in 1998 and is headquartered in Conway, Arkansas.