Head-To-Head Contrast: WesBanco (NASDAQ:WSBC) vs. Hanmi Financial (NASDAQ:HAFC)

Hanmi Financial (NASDAQ:HAFC) and WesBanco (NASDAQ:WSBC) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their dividends, profitability, valuation, institutional ownership, risk, earnings and analyst recommendations.

Earnings and Valuation

This table compares Hanmi Financial and WesBanco”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hanmi Financial	$233.37 million	2.86	$80.04 million	$2.40	9.14
WesBanco	$589.18 million	3.05	$159.03 million	$2.40	12.62

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

Profitability

This table compares Hanmi Financial and WesBanco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hanmi Financial	14.80%	8.97%	0.84%
WesBanco	15.22%	5.90%	0.79%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Hanmi Financial and WesBanco, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hanmi Financial	0	2	2	0	2.50
WesBanco	0	4	3	0	2.43

Hanmi Financial currently has a consensus target price of $22.63, suggesting a potential upside of 3.12%. WesBanco has a consensus target price of $34.71, suggesting a potential upside of 14.61%. Given WesBanco’s higher probable upside, analysts plainly believe WesBanco is more favorable than Hanmi Financial.

Volatility and Risk

Hanmi Financial has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, WesBanco has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500.

Insider & Institutional Ownership

88.7% of Hanmi Financial shares are held by institutional investors. Comparatively, 61.4% of WesBanco shares are held by institutional investors. 1.6% of Hanmi Financial shares are held by insiders. Comparatively, 3.4% of WesBanco shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Hanmi Financial pays an annual dividend of $1.00 per share and has a dividend yield of 4.6%. WesBanco pays an annual dividend of $1.44 per share and has a dividend yield of 4.8%. Hanmi Financial pays out 41.7% of its earnings in the form of a dividend. WesBanco pays out 60.0% 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. WesBanco has raised its dividend for 13 consecutive years. WesBanco is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

WesBanco beats Hanmi Financial on 10 of the 16 factors compared between the two stocks.

About Hanmi Financial

Hanmi Financial Corporation operates as the holding company for Hanmi Bank that provides business banking products and services in the United States. It offers various deposit products, including noninterest-bearing checking accounts, savings accounts, negotiable order of withdrawal accounts, money market accounts, and certificates of deposit. The company also provides real estate loans, such as commercial property, construction, and residential property loans; and commercial and industrial loans, such as commercial term loans and commercial lines of credit; and international finance and trade services and products, such as letters of credit, and import and export financing. In addition, it offers small business administration loans for business purposes, which comprise owner-occupied commercial real estate, business acquisitions, start-ups, franchise financing, working capital, improvements and renovations, inventory and equipment, and debt-refinancing, as well as equipment lease financing. The company was founded in 1982 and is headquartered in Los Angeles, California.

About WesBanco

WesBanco, Inc. operates as the bank holding company for WesBanco Bank, Inc. that provides retail banking, corporate banking, personal and corporate trust, brokerage, mortgage banking, and insurance services to individuals and businesses in the United States. The company operates through two segments, Community Banking, and Trust and Investment Services. It offers commercial demand, individual demand, and time deposit accounts; commercial, mortgage and individual installment loans; retail loans, such as residential real estate mortgage loans, home equity lines of credit, and loans for other consumer purposes; installment loans to finance the purchase of automobiles, trucks, motorcycles, boats, and other recreational vehicles, as well as home equity installment loans, unsecured home improvement loans, and revolving lines of credit; and various non-traditional offerings, such as insurance and securities brokerage services. The company also provides trust services; and various alternative investment products, including mutual funds and annuities. In addition, it acts as an agency that specializes in property, casualty, life, and title insurance, as well as benefit plan sales and administration to personal and commercial clients; provides broker dealer and discount brokerage services; holds investment securities and loans; and holds and leases commercial real estate properties, as well as acts as an investment adviser to a family of mutual funds. WesBanco, Inc. was founded in 1870 and is headquartered in Wheeling, West Virginia.