Head-To-Head Comparison: Great Western Bancorp (GWB) and Hancock (HBHC)

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Great Western Bancorp (NASDAQ: HBHC) and Hancock (NASDAQ:HBHC) are both mid-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their earnings, institutional ownership, dividends, profitability, analyst recommendations, risk and valuation.

Institutional and Insider Ownership

75.7% of Hancock shares are owned by institutional investors. 0.3% of Great Western Bancorp shares are owned by insiders. Comparatively, 1.0% of Hancock shares are owned by 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.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Great Western Bancorp and Hancock, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Great Western Bancorp 0 3 5 0 2.63
Hancock 0 2 4 0 2.67

Great Western Bancorp presently has a consensus price target of $46.25, indicating a potential upside of 6.10%. Hancock has a consensus price target of $56.17, indicating a potential upside of 8.74%. Given Hancock’s stronger consensus rating and higher possible upside, analysts plainly believe Hancock is more favorable than Great Western Bancorp.

Earnings & Valuation

This table compares Great Western Bancorp and Hancock’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Great Western Bancorp $497.73 million 5.16 $144.78 million $2.46 17.72
Hancock $1.17 billion 3.77 $215.63 million $2.92 17.69

Hancock has higher revenue and earnings than Great Western Bancorp. Hancock is trading at a lower price-to-earnings ratio than Great Western Bancorp, indicating that it is currently the more affordable of the two stocks.

Dividends

Great Western Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 2.3%. Hancock pays an annual dividend of $0.96 per share and has a dividend yield of 1.9%. Great Western Bancorp pays out 40.7% of its earnings in the form of a dividend. Hancock pays out 32.9% 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. Great Western Bancorp has raised its dividend for 2 consecutive years. Great Western Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Great Western Bancorp has a beta of 1.53, meaning that its stock price is 53% more volatile than the S&P 500. Comparatively, Hancock has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500.

Profitability

This table compares Great Western Bancorp and Hancock’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Great Western Bancorp 28.45% 9.36% 1.41%
Hancock 19.76% 9.70% 1.03%

Summary

Hancock beats Great Western Bancorp on 9 of the 17 factors compared between the two stocks.

About Great Western Bancorp

Great Western Bancorp, Inc. operates as the bank holding company for Great Western Bank that provides business and agribusiness banking, retail banking, and wealth management services. The company offers non-interest-bearing demand accounts, interest-bearing savings and money market accounts, individual retirement accounts, and time certificates of deposits, as well as NOW accounts. It also provides agricultural loans; commercial and industrial loans, including working capital and other shorter-term lines of credit, fixed-rate and variable rate loans; commercial real estate (CRE) loans comprising owner-occupied and non-owner-occupied CRE loans, multifamily residential real estate loans, and construction and development loans; short-term working capital funding, long-term land-related lending, and other tailored services; and residential mortgage, home equity, home equity lines of credit and general lines of credit, and auto loans and other loans. In addition, the company offers cash management services, online business deposit, and wire transfer services; credit cards; crop insurance; online, telephone, and mobile banking services; and wealth management solutions consisting of financial planning, private banking, investment management, and trust services through associations with third party vendors, including a registered broker-dealer and investment adviser. It serves retail customers; grain and protein producers; and small and mid-sized businesses in various industries, including ancillary agribusiness services, freight and transport, healthcare, and tourism. As of September 30, 2017, the company's branch network consisted of 173 branches located in 129 communities in Arizona, Colorado, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, and South Dakota, as well as operated 162 ATMs and 21 company-owned ATMs at off-site locations. The company was founded in 1935 and is based in Sioux Falls, South Dakota.

About Hancock

Hancock Holding Company operates as the bank holding company for Whitney Bank that provides a range of community banking services to commercial, small business, and retail customers. The company offers various deposit products, including noninterest-bearing demand deposits, interest-bearing transaction accounts, savings accounts, money market deposit accounts, and time deposit accounts. It also provides commercial and industrial; commercial real estate; construction and land development; and residential mortgages, including fixed and adjustable rate loans; and consumer loans comprising second lien mortgage home loans, home equity lines of credit, and nonresidential consumer purpose loans. In addition, the company offers treasury management services, investment brokerage services, letters of credit and financial guarantees, and revolving credit facilities. Further, it provides trust and investment management services to retirement plans, corporations, and individuals. Additionally, the company provides insurance agency services, discount investment brokerage services, life insurance, and consumer financing services, as well as operates and sells foreclosed assets. It operates approximately 237 full service banking and financial services offices and 277 automated teller machines in Gulf south corridor, south Mississippi; southern and central Alabama; southern Louisiana; the northern, central, and Panhandle regions of Florida; and Houston, Texas under the Hancock and Whitney Bank brand names, as well as operates a loan production office in Nashville, Tennessee. Hancock Holding Company was founded in 1883 and is headquartered in Gulfport, Mississippi.

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