MutualFirst Financial (NASDAQ: MFSF) and Wintrust Financial Corp (NASDAQ:WTFC) are both financials companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitabiliy, analyst recommendations and dividends.

Institutional & Insider Ownership

46.1% of MutualFirst Financial shares are held by institutional investors. Comparatively, 90.7% of Wintrust Financial Corp shares are held by institutional investors. 11.3% of MutualFirst Financial shares are held by insiders. Comparatively, 2.0% of Wintrust Financial Corp shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for MutualFirst Financial and Wintrust Financial Corp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
MutualFirst Financial 1 1 0 0 1.50
Wintrust Financial Corp 0 4 1 0 2.20

MutualFirst Financial currently has a consensus target price of $25.50, suggesting a potential downside of 27.04%. Wintrust Financial Corp has a consensus target price of $72.10, suggesting a potential downside of 6.12%. Given Wintrust Financial Corp’s stronger consensus rating and higher probable upside, analysts clearly believe Wintrust Financial Corp is more favorable than MutualFirst Financial.

Earnings and Valuation

This table compares MutualFirst Financial and Wintrust Financial Corp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
MutualFirst Financial $64.21 million 4.00 $13.81 million $1.88 18.59
Wintrust Financial Corp $1.04 billion 4.11 $209.27 million $3.76 20.43

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

Dividends

MutualFirst Financial pays an annual dividend of $0.64 per share and has a dividend yield of 1.8%. Wintrust Financial Corp pays an annual dividend of $0.56 per share and has a dividend yield of 0.7%. MutualFirst Financial pays out 34.0% of its earnings in the form of a dividend. Wintrust Financial Corp pays out 14.9% 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.

Profitability

This table compares MutualFirst Financial and Wintrust Financial Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
MutualFirst Financial 20.24% 9.10% 0.83%
Wintrust Financial Corp 22.34% 8.86% 0.91%

Volatility & Risk

MutualFirst Financial has a beta of 0.36, indicating that its share price is 64% less volatile than the S&P 500. Comparatively, Wintrust Financial Corp has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500.

Summary

Wintrust Financial Corp beats MutualFirst Financial on 13 of the 16 factors compared between the two stocks.

About MutualFirst Financial

MutualFirst Financial, Inc. (MutualFirst) is the bank holding company of MutualBank (MutualBank or the Bank). The Bank offers financial services through approximately 30 full service retail financial center offices in Allen, Delaware, Elkhart, Grant, Kosciusko, Randolph, Saint Joseph and Wabash counties in Indiana. MutualBank also has trust offices in Carmel and Crawfordsville, Indiana and a loan origination office in New Buffalo, Michigan. The Bank has a subsidiary, Summit Mortgage, Inc., that operates a mortgage banking firm in Fort Wayne, Indiana. In addition, it originates residential mortgage and commercial loans. MutualWealth and MutualFinancial Advisors are the wealth management and brokerage divisions of the Bank that provide a range of fee-based financial services, including trust, investment, insurance, broker advisory, retirement plan and private banking services, in its market areas.

About Wintrust Financial Corp

Wintrust Financial Corporation is a financial holding company. The Company conducts its businesses through three segments: community banking, specialty finance and wealth management. The Company offers community banking services to individuals, small to mid-sized businesses, local governmental units and institutional clients. Through specialty finance segment, the Company offers financing of insurance premiums for businesses and individuals; accounts receivable financing, value-added, out-sourced administrative services, and other specialty finance businesses. The Company offers a range of wealth management services through its subsidiaries, including trust and investment services, asset management and securities brokerage services. The Company offers MaxSafe deposit accounts, which provide customers with expanded Federal Deposit Insurance Corporation (FDIC) insurance coverage by spreading a customer’s deposit across its banks.

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