Pinnacle Financial Partners (PNFP) and Its Rivals Critical Review

Pinnacle Financial Partners (NYSE:PNFP) is one of 919 publicly-traded companies in the “Banks” industry, but how does it contrast to its peers? We will compare Pinnacle Financial Partners to related businesses based on the strength of its dividends, risk, profitability, analyst recommendations, earnings, institutional ownership and valuation.

Risk and Volatility

Pinnacle Financial Partners has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500. Comparatively, Pinnacle Financial Partners’ peers have a beta of 0.52, meaning that their average stock price is 48% less volatile than the S&P 500.

Dividends

Pinnacle Financial Partners pays an annual dividend of $2.00 per share and has a dividend yield of 1.9%. Pinnacle Financial Partners pays out 26.7% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 9.2% and pay out 28.9% of their earnings in the form of a dividend. Pinnacle Financial Partners has increased its dividend for 1 consecutive years.

Valuation & Earnings

This table compares Pinnacle Financial Partners and its peers revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Pinnacle Financial Partners	$3.32 billion	$641.86 million	13.75
Pinnacle Financial Partners Competitors	$9.95 billion	$2.42 billion	17.38

Pinnacle Financial Partners’ peers have higher revenue and earnings than Pinnacle Financial Partners. Pinnacle Financial Partners is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Pinnacle Financial Partners and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pinnacle Financial Partners	15.97%	11.33%	1.25%
Pinnacle Financial Partners Competitors	15.66%	9.44%	0.93%

Analyst Ratings

This is a breakdown of current ratings and price targets for Pinnacle Financial Partners and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pinnacle Financial Partners	0	3	17	1	2.90
Pinnacle Financial Partners Competitors	7463	30186	27757	1457	2.35

Pinnacle Financial Partners currently has a consensus target price of $120.15, indicating a potential upside of 16.67%. As a group, “Banks” companies have a potential upside of 15.49%. Given Pinnacle Financial Partners’ stronger consensus rating and higher possible upside, equities analysts clearly believe Pinnacle Financial Partners is more favorable than its peers.

Institutional and Insider Ownership

87.4% of Pinnacle Financial Partners shares are held by institutional investors. Comparatively, 47.8% of shares of all “Banks” companies are held by institutional investors. 1.3% of Pinnacle Financial Partners shares are held by insiders. Comparatively, 9.8% of shares of all “Banks” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Pinnacle Financial Partners beats its peers on 10 of the 15 factors compared.

Pinnacle Financial Partners Company Profile

Pinnacle Financial Partners, Inc. operates as the bank holding company for Pinnacle Bank that provides various banking products and services to individuals, businesses, and professional entities in the United States. It accepts various deposits, including savings, noninterest-bearing and interest-bearing checking, money market, and certificate of deposit accounts; and provides treasury management services, such as online wire origination, enhanced ACH origination, positive pay, zero balance and sweep accounts, automated bill pay services, electronic receivables processing, lockbox processing, and merchant card acceptance services, small business and commercial credit cards corporate purchasing cards, and virtual accounting/deposit escrow solutions. The company also offers equipment and working capital loan; commercial real estate loans, such as investment properties and business loan; secured and unsecured loans comprising installment and term, lines of credit, and residential first mortgage, as well as home equity loans and home equity lines of credit; and credit cards for consumers and businesses. In addition, the company provides investment products; brokerage and investment advisory programs; and fiduciary and investment services, including personal trust, investment management, estate administration, endowments, foundations, individual retirement accounts, escrow services, and custody. Further, it offers insurance agency services in the property and casualty area; investment, merger and acquisition advisory services, private debt, equity and mezzanine, and other middle-market advisory services; and other banking services, including telephone and online banking, mobile banking, debit cards, direct deposit and remote deposit capture, mobile deposit option, automated teller machine, and cash management services. Pinnacle Financial Partners, Inc. was incorporated in 2000 and is headquartered in Nashville, Tennessee.