Grupo Financiero Banorte (OTCMKTS:GBOOY) versus VersaBank (NASDAQ:VBNK) Head-To-Head Review

Grupo Financiero Banorte (OTCMKTS:GBOOY – Get Rating) and VersaBank (NASDAQ:VBNK – Get Rating) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, risk, valuation, institutional ownership, profitability, analyst recommendations and dividends.

Dividends

Grupo Financiero Banorte pays an annual dividend of $2.72 per share and has a dividend yield of 6.6%. VersaBank pays an annual dividend of $0.07 per share and has a dividend yield of 1.0%. Grupo Financiero Banorte pays out 85.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. VersaBank pays out 9.9% of its earnings in the form of a dividend.

Profitability

This table compares Grupo Financiero Banorte and VersaBank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grupo Financiero Banorte	N/A	N/A	N/A
VersaBank	16.82%	7.54%	0.84%

Earnings & Valuation

This table compares Grupo Financiero Banorte and VersaBank’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grupo Financiero Banorte	$7.68 billion	N/A	$1.73 billion	$3.18	13.00
VersaBank	$102.93 million	1.84	$17.60 million	$0.71	10.06

Grupo Financiero Banorte has higher revenue and earnings than VersaBank. VersaBank is trading at a lower price-to-earnings ratio than Grupo Financiero Banorte, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

0.0% of Grupo Financiero Banorte shares are held by institutional investors. Comparatively, 30.2% of VersaBank shares are held by institutional investors. 5.3% of VersaBank shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings for Grupo Financiero Banorte and VersaBank, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grupo Financiero Banorte	0	1	2	0	2.67
VersaBank	0	0	2	0	3.00

VersaBank has a consensus target price of $9.00, suggesting a potential upside of 26.05%. Given VersaBank’s stronger consensus rating and higher probable upside, analysts clearly believe VersaBank is more favorable than Grupo Financiero Banorte.

Volatility and Risk

Grupo Financiero Banorte has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500. Comparatively, VersaBank has a beta of 0.48, meaning that its stock price is 52% less volatile than the S&P 500.

Summary

VersaBank beats Grupo Financiero Banorte on 8 of the 14 factors compared between the two stocks.

About Grupo Financiero Banorte

(Get Rating)

Grupo Financiero Banorte SAB de CV is a holding company, which engages in the provision of banking services. It operates through the following segments: Holding, Banorte, Savings and Forecast, Landlord and Factor, Storage, and Brokerage house Banorte. The company was founded in 1899 and is headquartered in Mexico City, Mexico.

About VersaBank

(Get Rating)

VersaBank engages in the provision of financial services. It operates through Digital Banking and DRTC. The Digital Banking segment offers business to business model using its financial technoolgy to address issues in the US banking market. The DRTC segment refers to developed IT security software and capabilities. The company was founded by David Roy Taylor on January 18, 1993 and is headquartered in London, Canada.