Wells Fargo & Co (NASDAQ: FULT) and Fulton Financial (NASDAQ:FULT) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations and price targets for Wells Fargo & Co and Fulton Financial, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Wells Fargo & Co 2 7 14 0 2.52
Fulton Financial 1 5 1 0 2.00

Wells Fargo & Co currently has a consensus target price of $63.84, suggesting a potential upside of 8.78%. Fulton Financial has a consensus target price of $18.33, suggesting a potential upside of 1.29%. Given Wells Fargo & Co’s stronger consensus rating and higher possible upside, equities analysts plainly believe Wells Fargo & Co is more favorable than Fulton Financial.

Profitability

This table compares Wells Fargo & Co and Fulton Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Wells Fargo & Co 22.03% 12.38% 1.17%
Fulton Financial 19.05% 8.20% 0.91%

Dividends

Wells Fargo & Co pays an annual dividend of $1.72 per share and has a dividend yield of 2.9%. Fulton Financial pays an annual dividend of $0.48 per share and has a dividend yield of 2.7%. Wells Fargo & Co pays out 41.8% of its earnings in the form of a dividend. Fulton Financial pays out 44.9% 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 6 consecutive years and Fulton Financial has raised its dividend for 7 consecutive years. Wells Fargo & Co is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Wells Fargo & Co has a beta of 1.13, suggesting that its share price is 13% more volatile than the S&P 500. Comparatively, Fulton Financial has a beta of 1.01, suggesting that its share price is 1% more volatile than the S&P 500.

Valuation & Earnings

This table compares Wells Fargo & Co and Fulton Financial’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Wells Fargo & Co $97.74 billion 2.93 $22.18 billion $4.11 14.28
Fulton Financial $876.84 million 3.63 $171.75 million $1.07 16.92

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

Insider & Institutional Ownership

75.9% of Wells Fargo & Co shares are held by institutional investors. Comparatively, 63.4% of Fulton Financial shares are held by institutional investors. 0.1% of Wells Fargo & Co shares are held by company insiders. Comparatively, 0.8% of Fulton Financial shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Wells Fargo & Co beats Fulton Financial on 13 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. It serves clients through approximately 8,300 locations and 13,000 ATMs; online and mobile banking; and offices in 42 countries. Wells Fargo & Company was founded in 1852 and is headquartered in San Francisco, California.

Fulton Financial Company Profile

Fulton Financial Corporation operates as a multi-bank financial holding company that provides banking and financial services to businesses and consumers. It accepts various checking accounts and savings deposit products, certificates of deposit, and individual retirement accounts. The company also offers consumer loans, including home equity loans and lines of credit, automobile loans, automobile and equipment leases, personal lines of credit, and checking account overdraft protection; construction and jumbo residential mortgage loans; and commercial lending products comprising commercial, financial, agricultural, and real estate loans. In addition, it provides equipment leasing, letters of credit, cash management services, and traditional deposit products; and investment management, trust, brokerage, insurance, and investment advisory services. Further, the company owns investment securities and other investments, as well as trust preferred securities; and sells various life insurance products. It provides its products and services through branch banking, as well as through a network of automated teller machines, telephone banking, mobile banking, and online banking. As of January 18, 2018, the company operated 240 branches in Pennsylvania, Maryland, Delaware, New Jersey, and Virginia. Fulton Financial Corporation was founded in 1882 and is headquartered in Lancaster, Pennsylvania.

Receive News & Ratings for Wells Fargo & Co Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Wells Fargo & Co and related companies with MarketBeat.com's FREE daily email newsletter.