Access National (NASDAQ: ANCX) and Wells Fargo & Co (NYSE:WFC) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, institutional ownership and risk.
Volatility and Risk
Access National has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500. Comparatively, Wells Fargo & Co has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500.
36.8% of Access National shares are owned by institutional investors. Comparatively, 75.7% of Wells Fargo & Co shares are owned by institutional investors. 14.2% of Access National shares are owned by company insiders. Comparatively, 0.2% of Wells Fargo & Co shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a breakdown of current ratings and target prices for Access National and Wells Fargo & Co, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Wells Fargo & Co||5||8||13||0||2.31|
Access National presently has a consensus target price of $31.00, indicating a potential upside of 9.54%. Wells Fargo & Co has a consensus target price of $63.17, indicating a potential upside of 5.36%. Given Access National’s stronger consensus rating and higher possible upside, analysts plainly believe Access National is more favorable than Wells Fargo & Co.
Earnings and Valuation
This table compares Access National and Wells Fargo & Co’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Access National||$127.57 million||4.55||$16.50 million||$0.81||34.94|
|Wells Fargo & Co||$97.74 billion||3.00||$22.18 billion||$3.45||17.38|
Wells Fargo & Co has higher revenue and earnings than Access National. Wells Fargo & Co is trading at a lower price-to-earnings ratio than Access National, indicating that it is currently the more affordable of the two stocks.
Access National pays an annual dividend of $0.60 per share and has a dividend yield of 2.1%. Wells Fargo & Co pays an annual dividend of $1.56 per share and has a dividend yield of 2.6%. Access National pays out 74.1% of its earnings in the form of a dividend. Wells Fargo & Co pays out 45.2% 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. Wells Fargo & Co has increased its dividend for 6 consecutive years. Wells Fargo & Co is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares Access National and Wells Fargo & Co’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Wells Fargo & Co||22.57%||12.24%||1.14%|
Wells Fargo & Co beats Access National on 11 of the 17 factors compared between the two stocks.
About Access National
Access National Corporation is a bank holding company. The Company operates through its subsidiary, Access National Bank (the Bank). The Bank offers a range of financial services and products, and specializes in providing customized financial services to small and medium sized businesses, professionals and associated individuals. The Company operates through three segments: traditional commercial banking, mortgage banking and wealth management. Its commercial banking segment includes loans, investment securities and deposit services. Its mortgage banking segment includes mortgage loans held for sale, sales of loans in the secondary mortgage market and loan origination. Its wealth management segment includes portfolio asset management. The commercial banking segment provides the mortgage banking segment with the short-term funds needed to originate mortgage loans through a warehouse line of credit and charges interest to the mortgage banking segment.
About Wells Fargo & Co
Wells Fargo & Company is a bank holding company. The Company is a diversified financial services company. It has three operating segments: Community Banking, Wholesale Banking, and Wealth and Investment Management. The Company offers its services under three categories: personal, small business and commercial. It provides retail, commercial and corporate banking services through banking locations and offices, the Internet and other distribution channels to individuals, businesses and institutions in all 50 states, the District of Columbia and in other countries. It provides other financial services through its subsidiaries engaged in various businesses, including wholesale banking, mortgage banking, consumer finance, equipment leasing, agricultural finance, commercial finance, securities brokerage and investment banking, computer and data processing services, investment advisory services, mortgage-backed securities servicing and venture capital investment.
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