Banco Bradesco (NYSE:BBDO) and Bank of Hawaii (NYSE:BOH) Critical Comparison

Banco Bradesco (NYSE:BBDO) and Bank of Hawaii (NYSE:BOH) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, analyst recommendations and dividends.

Dividends

Banco Bradesco pays an annual dividend of $0.03 per share and has a dividend yield of 1.3%. Bank of Hawaii pays an annual dividend of $2.80 per share and has a dividend yield of 4.0%. Banco Bradesco pays out 6.5% of its earnings in the form of a dividend. Bank of Hawaii pays out 49.6% 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. Bank of Hawaii has increased its dividend for 1 consecutive years. Bank of Hawaii is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Banco Bradesco has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, Bank of Hawaii has a beta of 0.72, suggesting that its share price is 28% less volatile than the S&P 500.

Valuation & Earnings

This table compares Banco Bradesco and Bank of Hawaii”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Bradesco	$41.79 billion	0.60	$4.24 billion	$0.46	5.18
Bank of Hawaii	$756.21 million	3.62	$205.90 million	$5.65	12.36

Banco Bradesco has higher revenue and earnings than Bank of Hawaii. Banco Bradesco is trading at a lower price-to-earnings ratio than Bank of Hawaii, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

82.2% of Bank of Hawaii shares are held by institutional investors. 0.3% of Banco Bradesco shares are held by company insiders. Comparatively, 2.0% of Bank of Hawaii shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Banco Bradesco and Bank of Hawaii’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Bradesco	12.58%	15.06%	1.14%
Bank of Hawaii	22.89%	16.35%	1.03%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Banco Bradesco and Bank of Hawaii, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Bradesco	0	1	1	0	2.50
Bank of Hawaii	0	6	2	0	2.25

Bank of Hawaii has a consensus target price of $79.80, indicating a potential upside of 14.25%. Given Bank of Hawaii’s higher probable upside, analysts plainly believe Bank of Hawaii is more favorable than Banco Bradesco.

Summary

Bank of Hawaii beats Banco Bradesco on 12 of the 17 factors compared between the two stocks.

About Banco Bradesco

Banco Bradesco S.A. is a Brazilian financial services company founded in 1943 by Amador Aguiar. Headquartered in Osasco, São Paulo, it serves individuals, businesses and institutions, primarily in Brazil. The company provides banking services including checking and savings accounts, loans, credit and debit cards, payments and investment products. It also operates in insurance, pension plans, asset management, brokerage and other financial services. Bradesco serves customers through a network of branches and other service points, as well as digital banking channels.

About Bank of Hawaii

Bank of Hawaii Corporation is a bank holding company headquartered in Honolulu. Founded in 1897, it provides banking and financial services to individuals, businesses and public-sector organizations, primarily in Hawaii. The company offers consumer banking services such as checking and savings accounts, certificates of deposit, mortgages, personal loans and credit cards. It also provides commercial banking, including business lending, deposit accounts and cash management services. Additional services include wealth management, investment and trust services.