Financial Review: China Minsheng (OTCMKTS:CMAKY) & Eagle Financial Services (NASDAQ:EFSI)

Eagle Financial Services (NASDAQ:EFSI) and China Minsheng (OTCMKTS:CMAKY) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, profitability, institutional ownership, dividends, earnings, analyst recommendations and valuation.

Profitability

This table compares Eagle Financial Services and China Minsheng’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eagle Financial Services	15.16%	8.38%	0.85%
China Minsheng	11.70%	4.23%	0.38%

Dividends

Eagle Financial Services pays an annual dividend of $1.24 per share and has a dividend yield of 3.0%. China Minsheng pays an annual dividend of $0.11 per share and has a dividend yield of 2.3%. Eagle Financial Services pays out 35.8% of its earnings in the form of a dividend. China Minsheng pays out 12.8% 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. Eagle Financial Services has increased its dividend for 14 consecutive years. Eagle Financial Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Eagle Financial Services and China Minsheng, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eagle Financial Services	1	1	2	1	2.60
China Minsheng	0	0	0	1	4.00

Eagle Financial Services currently has a consensus price target of $42.25, suggesting a potential upside of 1.08%. Given Eagle Financial Services’ higher possible upside, research analysts clearly believe Eagle Financial Services is more favorable than China Minsheng.

Valuation and Earnings

This table compares Eagle Financial Services and China Minsheng”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eagle Financial Services	$87.31 million	2.59	$8.21 million	$3.46	12.08
China Minsheng	$33.55 billion	0.62	$4.25 billion	$0.86	5.56

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

Volatility & Risk

Eagle Financial Services has a beta of 0.23, meaning that its stock price is 77% less volatile than the S&P 500. Comparatively, China Minsheng has a beta of 0.3, meaning that its stock price is 70% less volatile than the S&P 500.

Institutional and Insider Ownership

0.3% of Eagle Financial Services shares are owned by institutional investors. 7.1% of Eagle Financial Services shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Eagle Financial Services beats China Minsheng on 12 of the 17 factors compared between the two stocks.

About Eagle Financial Services

Eagle Financial Services, Inc. operates as the bank holding company for Bank of Clarke County that provides various retail and commercial banking products and services in the Shenandoah Valley and Northern Virginia. The company’s deposit products include checking, NOW, money market, and regular savings accounts; and demand and time deposits. Its loan portfolio comprises one-to-four-family residential real estate, commercial real estate, construction and land development, and commercial and industrial loans, as well as secured and unsecured consumer loans, which include personal installment loans, personal lines of credit, automobile loans, and credit card loans. The company also offers personal and retirement plan services; investment services comprising tax-deferred annuities, IRAs and rollovers, mutual funds, retirement plans, college savings plans, life insurance, long term care insurance, fixed income investing, brokerage CDs, and full service or discount brokerage services; non-deposit investment products; and title insurance products. In addition, it provides ATM and debit cards; and telephone, internet, and mobile banking services, as well as other commercial deposit account services, such as ACH origination and remote deposit capture services. The company operates through twelve full-service branches, two loan production offices, one wealth management office, and one drive-through only facility, as well as 13 ATM locations in the Virginia communities of Berryville, Winchester, Boyce, Stephens City, Purcellville, Warrenton, Leesburg, Ashburn, and Fairfax. Eagle Financial Services, Inc. was founded in 1881 and is headquartered in Berryville, Virginia.

About China Minsheng

China Minsheng Banking Corp., Ltd. provides banking products and services for individuals, small and micro-enterprises, corporate customers, government agencies, and financial institutions in the People's Republic of China. The company operates through Corporate Banking, Retail Banking, and Others segments. Its deposit products include saving accounts, deposit books and certificates, contracted deposits, agreement deposits, call deposits, corporate term deposits, and corporate current deposits. The company also offers personal housing mortgage, individual automobile purchase, household composite consumption, micro-credit products for individuals, medium and long term, and short-term working capital loans; and debit and credit cards. In addition, it provides appointed and domestic remittance, payment and collection agent, clearing, safe deposit boxes, VIP, and salary and welfare agent card services, as well as internet, mobile, telephone, and self-serve banking services. Further, the company offers gross settlement; wages distribution agency and letter of guarantee; cash management; trade finance; industrial chain finance; individual forex settlement, forex remittance, travelers promissory notes, collection, individual deposit certificate, and guarantee letter products; and comprehensive credit granting, forex settlement and sale, financial product investment, asset management, and trust financing services. Additionally, it provides convenient finance and investment banking services, as well as non-financial services in the education, business travel, traveler, art, luxury life, health, club, and isports areas. The company operates through branch-level institutions, business outlets, community sub-branches, and small business sub-branches. China Minsheng Banking Corp., Ltd. was incorporated in 1996 and is headquartered in Beijing, the People's Republic of China.