Contrasting First Hawaiian (NASDAQ:FHB) & Citigroup (NYSE:C)

Citigroup (NYSE:C) and First Hawaiian (NASDAQ:FHB) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, risk, institutional ownership, earnings and analyst recommendations.

Analyst Recommendations

This is a breakdown of recent ratings for Citigroup and First Hawaiian, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Citigroup	0	3	14	1	2.89
First Hawaiian	2	7	2	0	2.00

Citigroup currently has a consensus target price of $150.79, indicating a potential upside of 21.25%. First Hawaiian has a consensus target price of $29.00, indicating a potential upside of 16.23%. Given Citigroup’s stronger consensus rating and higher probable upside, equities analysts plainly believe Citigroup is more favorable than First Hawaiian.

Dividends

Citigroup pays an annual dividend of $2.68 per share and has a dividend yield of 2.2%. First Hawaiian pays an annual dividend of $1.04 per share and has a dividend yield of 4.2%. Citigroup pays out 26.1% of its earnings in the form of a dividend. First Hawaiian 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. Citigroup has raised its dividend for 2 consecutive years.

Institutional and Insider Ownership

71.7% of Citigroup shares are held by institutional investors. Comparatively, 97.6% of First Hawaiian shares are held by institutional investors. 0.1% of Citigroup shares are held by company insiders. Comparatively, 0.7% of First Hawaiian shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

Citigroup has a beta of 1.13, indicating that its stock price is 13% more volatile than the S&P 500. Comparatively, First Hawaiian has a beta of 0.76, indicating that its stock price is 24% less volatile than the S&P 500.

Profitability

This table compares Citigroup and First Hawaiian’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Citigroup	10.97%	10.57%	0.73%
First Hawaiian	24.41%	10.27%	1.19%

Valuation and Earnings

This table compares Citigroup and First Hawaiian”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Citigroup	$91.38 billion	2.32	$14.31 billion	$10.25	12.13
First Hawaiian	$870.02 million	3.49	$276.27 million	$2.30	10.85

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

Summary

Citigroup beats First Hawaiian on 12 of the 18 factors compared between the two stocks.

About Citigroup

Citigroup Inc., a diversified financial service holding company, provides various financial product and services to consumers, corporations, governments, and institutions worldwide. It operates through five segments: Services, Markets, Banking, U.S. Personal Banking, and Wealth. The Services segment includes Treasury and Trade Solutions, which provides cash management, trade, and working capital solutions to multinational corporations, financial institutions, and public sector organizations; and Securities Services, such as cross-border support for clients, local market expertise, post-trade technologies, data solutions, and various securities services solutions. The Markets segment offers sales and trading services for equities, foreign exchange, rates, spread products, and commodities to corporate, institutional, and public sector clients; and market-making services, including asset classes, risk management solutions, financing, prime brokerage, research, securities clearing, and settlement. The banking segment includes investment banking; advisory services related to mergers and acquisitions, divestitures, restructurings, and corporate defense activities; and corporate lending, which includes corporate and commercial banking. The U.S. Personal Banking segment provides co-branded cards and retail banking services. The Wealth segment provides financial services to high-net-worth clients through banking, lending, mortgages, investment, custody, and trust product offerings; and to professional industries, including law firms, consulting groups, accounting, and asset management. The company was founded in 1812 and is headquartered in New York, New York.

About First Hawaiian

First Hawaiian, Inc. operates as a bank holding company for First Hawaiian Bank that provides a range of banking products and services to consumer and commercial customers in the United States. It operates in three segments: Retail Banking, Commercial Banking, and Treasury and Other. The company offers various deposit products, including checking, savings, and time deposit accounts, and other deposit accounts. It also provides residential and commercial mortgage loans, home equity lines of credit and loans, automobile loans and leases, secured and unsecured lines of credit, installment loans, small business loans and leases, and construction lending, as well as commercial lease and auto dealer financing. In addition, the company offers wealth management, personal installment, individual investment and financial planning, insurance protection, trust and estate, private banking, investment management, retirement planning, and merchant processing services, as well as consumer and commercial credit cards. The company was formerly known as BancWest Corporation and changed its name to First Hawaiian, Inc. in April 2016. First Hawaiian, Inc. was founded in 1858 and is headquartered in Honolulu, Hawaii.