Citigroup (NYSE: C) and Cardinal Financial (NASDAQ:CFNL) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.

Profitability

This table compares Citigroup and Cardinal Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Citigroup 18.11% 7.48% 0.85%
Cardinal Financial 27.09% 10.86% 1.17%

Risk & Volatility

Citigroup has a beta of 1.55, indicating that its stock price is 55% more volatile than the S&P 500. Comparatively, Cardinal Financial has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Citigroup and Cardinal Financial, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Citigroup 1 7 13 0 2.57
Cardinal Financial 0 1 0 0 2.00

Citigroup presently has a consensus price target of $77.14, suggesting a potential upside of 1.91%. Cardinal Financial has a consensus price target of $31.00, suggesting a potential upside of 6.75%. Given Cardinal Financial’s higher possible upside, analysts plainly believe Cardinal Financial is more favorable than Citigroup.

Dividends

Citigroup pays an annual dividend of $1.28 per share and has a dividend yield of 1.7%. Cardinal Financial pays an annual dividend of $0.52 per share and has a dividend yield of 1.8%. Citigroup pays out 24.7% of its earnings in the form of a dividend. Cardinal Financial pays out 35.4% 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. Citigroup has raised its dividend for 2 consecutive years.

Institutional and Insider Ownership

78.6% of Citigroup shares are held by institutional investors. Comparatively, 75.2% of Cardinal Financial shares are held by institutional investors. 0.1% of Citigroup shares are held by company insiders. Comparatively, 6.2% of Cardinal Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Citigroup and Cardinal Financial’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Citigroup $82.39 billion 2.43 $14.91 billion $5.19 14.58
Cardinal Financial N/A N/A N/A $1.47 19.76

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

Summary

Citigroup beats Cardinal Financial on 8 of the 14 factors compared between the two stocks.

Citigroup Company Profile

Citigroup Inc. (Citi) is a financial services holding company. The Company’s whose businesses provide consumers, corporations, governments and institutions with a range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, trade and securities services and wealth management. The Company operates through two segments: Citicorp and Citi Holdings. Citicorp is the Company’s global bank for consumers and businesses and represents its core franchises. Citicorp is focused on providing products and services to customers and leveraging the Company’s global network, including various economies. As of December 31, 2016, Citicorp was present in 97 countries and jurisdictions, and offered services in over 160 countries and jurisdictions. Global Consumer Banking (GCB) provides traditional banking services to retail customers through retail banking, including Citi-branded cards and Citi retail services.

Cardinal Financial Company Profile

Cardinal Financial Corporation is a financial holding company. The Company owns Cardinal Bank (the Bank), a Virginia state-chartered community bank. The Bank operates in three business segments: commercial banking, mortgage banking and wealth management services. The commercial banking segment includes both commercial and consumer lending and provides customers such products as commercial loans, real estate loans, and other business financing and consumer loans. In addition, the commercial banking segment provides customers with several choices of deposit products, including demand deposit accounts, savings accounts and certificates of deposit. The mortgage banking segment is engaged in the origination and acquisition of residential mortgages for sale into the secondary market. The wealth management services segment provides investment and financial advisory services to businesses and individuals, including financial planning, retirement/estate planning and investment management.

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