Contrasting Wintrust Financial (NASDAQ:WTFC) and Trustmark (NASDAQ:TRMK)

Trustmark (NASDAQ:TRMK) and Wintrust Financial (NASDAQ:WTFC) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, risk, institutional ownership, earnings, valuation and profitability.

Dividends

Trustmark pays an annual dividend of $1.00 per share and has a dividend yield of 2.1%. Wintrust Financial pays an annual dividend of $2.20 per share and has a dividend yield of 1.4%. Trustmark pays out 25.4% of its earnings in the form of a dividend. Wintrust Financial pays out 17.7% 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. Trustmark has increased its dividend for 1 consecutive years and Wintrust Financial has increased its dividend for 12 consecutive years.

Analyst Ratings

This is a summary of recent recommendations for Trustmark and Wintrust Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Trustmark	0	5	1	1	2.43
Wintrust Financial	0	4	9	0	2.69

Trustmark currently has a consensus target price of $46.12, suggesting a potential downside of 1.06%. Wintrust Financial has a consensus target price of $177.77, suggesting a potential upside of 15.34%. Given Wintrust Financial’s stronger consensus rating and higher probable upside, analysts plainly believe Wintrust Financial is more favorable than Trustmark.

Insider and Institutional Ownership

67.6% of Trustmark shares are owned by institutional investors. Comparatively, 93.5% of Wintrust Financial shares are owned by institutional investors. 1.7% of Trustmark shares are owned by insiders. Comparatively, 1.2% of Wintrust Financial shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk & Volatility

Trustmark has a beta of 0.64, meaning that its stock price is 36% less volatile than the S&P 500. Comparatively, Wintrust Financial has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Trustmark	20.75%	10.69%	1.20%
Wintrust Financial	20.72%	13.37%	1.28%

Earnings and Valuation

This table compares Trustmark and Wintrust Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Trustmark	$1.12 billion	2.41	$224.13 million	$3.94	11.83
Wintrust Financial	$4.23 billion	2.46	$823.84 million	$12.45	12.38

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

Summary

Wintrust Financial beats Trustmark on 14 of the 18 factors compared between the two stocks.

About Trustmark

Trustmark Corporation operates as the bank holding company for Trustmark National Bank that provides banking and other financial solutions to individuals and corporate institutions in the United States. The company operates through three segments: General Banking, Wealth Management, and Insurance. It offers checking, savings, and money market accounts; certificates of deposits and individual retirement accounts; financing for commercial and industrial projects, income-producing commercial real estate, owner-occupied real estate, and construction and land development; and installment and real estate loans, and lines of credit, as well as treasury management services. The company also provides mortgage banking services, including construction financing, production of conventional and government-insured mortgages, and secondary marketing and mortgage servicing. In addition, it provides wealth management and trust services, such as administration of personal trusts and estates; management of investment accounts for individuals, employee benefit plans, and charitable foundations; and corporate trust and institutional custody, securities brokerage, financial and estate planning, retirement plan, and investment management services. Further, the company offers business insurance products and services for medical professionals, construction, manufacturing, hospitality, real estate, and group life and health plans; and life and health insurance, and personal line policies for individual customers. Trustmark Corporation was founded in 1889 and is headquartered in Jackson, Mississippi.

About Wintrust Financial

Wintrust Financial Corporation operates as a financial holding company. It operates in three segments: Community Banking, Specialty Finance, and Wealth Management. The Community Banking segment offers non-interest bearing deposits, non-brokered interest-bearing transaction accounts, and savings and domestic time deposits; home equity, consumer, and real estate loans; safe deposit facilities; and automatic teller machine (ATM), online and mobile banking, and other services. It also engages in the retail origination and purchase of residential mortgages; and provision of lending, deposits, and treasury management services to condominium, homeowner, and community associations, as well as asset-based lending for middle-market companies. In addition, this segment offers loan and deposit services to mortgage brokerage companies; lending to restaurant franchisees; direct leasing; small business administration loans; commercial mortgages and construction loans; and financial solutions. It provides personal and commercial banking services primarily to individuals, small to mid-sized businesses, local governmental units, and institutional clients. The Specialty Finance segment offers commercial and life insurance premiums financing for businesses and individuals; accounts receivable financing, value-added, and out-sourced administrative services; other specialty finance services; equipment financing through structured loan and lease products; and property and casualty premium financing; as well as data processing of payrolls, billing, and cash management services to temporary staffing industry. The Wealth Management segment provides wealth management services, such as trust and investment, asset management, tax-deferred exchange, securities brokerage, and retirement plan services. Wintrust Financial Corporation was founded in 1991 and is headquartered in Rosemont, Illinois.