U.S. Bancorp (NYSE:USB – Get Free Report) and Synovus Financial (NYSE:SNV – Get Free Report) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, profitability, valuation, analyst recommendations, institutional ownership, earnings and risk.
Profitability
This table compares U.S. Bancorp and Synovus Financial’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| U.S. Bancorp | 12.55% | 13.34% | 0.97% |
| Synovus Financial | 8.40% | 12.76% | 0.95% |
Institutional & Insider Ownership
77.6% of U.S. Bancorp shares are held by institutional investors. Comparatively, 83.9% of Synovus Financial shares are held by institutional investors. 0.2% of U.S. Bancorp shares are held by insiders. Comparatively, 0.8% of Synovus Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Volatility & Risk
U.S. Bancorp has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500. Comparatively, Synovus Financial has a beta of 1.4, meaning that its stock price is 40% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current recommendations for U.S. Bancorp and Synovus Financial, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| U.S. Bancorp | 0 | 12 | 7 | 0 | 2.37 |
| Synovus Financial | 0 | 6 | 10 | 0 | 2.63 |
U.S. Bancorp currently has a consensus price target of $48.23, suggesting a potential upside of 13.95%. Synovus Financial has a consensus price target of $45.81, suggesting a potential upside of 9.16%. Given U.S. Bancorp’s higher probable upside, research analysts plainly believe U.S. Bancorp is more favorable than Synovus Financial.
Dividends
U.S. Bancorp pays an annual dividend of $1.96 per share and has a dividend yield of 4.6%. Synovus Financial pays an annual dividend of $1.52 per share and has a dividend yield of 3.6%. U.S. Bancorp pays out 64.9% of its earnings in the form of a dividend. Synovus Financial pays out 52.1% 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. U.S. Bancorp has increased its dividend for 13 consecutive years. U.S. Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings and Valuation
This table compares U.S. Bancorp and Synovus Financial’s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| U.S. Bancorp | $40.62 billion | 1.63 | $5.43 billion | $3.02 | 14.02 |
| Synovus Financial | $3.45 billion | 1.78 | $543.71 million | $2.92 | 14.37 |
U.S. Bancorp has higher revenue and earnings than Synovus Financial. U.S. Bancorp is trading at a lower price-to-earnings ratio than Synovus Financial, indicating that it is currently the more affordable of the two stocks.
Summary
U.S. Bancorp beats Synovus Financial on 9 of the 17 factors compared between the two stocks.
About U.S. Bancorp
U.S. Bancorp, a financial services holding company, provides various financial services to individuals, businesses, institutional organizations, governmental entities, and other financial institutions in the United States. It operates through Wealth, Corporate, Commercial and Institutional Banking; Consumer and Business Banking; Payment Services; and Treasury and Corporate Support segments. The company offers depository services, including checking accounts, savings accounts, and time certificate contracts; and lending services, such as traditional credit products and credit card services, lease financing and import/export trade, asset-backed lending, agricultural finance, and other products. It also provides ancillary services comprising capital markets, treasury management, and receivable lock-box collection services to corporate and governmental entity customers. In addition, the company offers asset management and fiduciary services for individuals, estates, foundations, business corporations, and charitable organizations. Further, it provides investment and insurance products to its customers principally within its domestic markets, as well as fund administration services to mutual and other funds. Additionally, the company provides corporate and purchasing card, and corporate trust services. Furthermore, it offers trust and investment management, merchant and ATM processing, mortgage banking, insurance, and brokerage and leasing services. U.S. Bancorp was founded in 1863 and is headquartered in Minneapolis, Minnesota.
About Synovus Financial
Synovus Financial Corp. operates as the bank holding company for Synovus Bank that provides commercial and consumer banking products and services. It operates through four segments: Community Banking, Wholesale Banking, Consumer Banking, and Financial Management Services. The company’s commercial banking services include treasury and asset management, capital market, and institutional trust services, as well as commercial, financial, and real estate lending services. Its consumer banking services comprise accepting customary types of demand and savings deposits accounts; mortgage, installment, and other consumer loans; investment and brokerage services; safe deposit services; automated banking services; automated fund transfers; internet-based banking services; and bank credit and debit card services, including Visa and MasterCard services. The company also offers various other financial services, including portfolio management for fixed-income securities, investment banking, execution of securities transactions as a broker/dealer, trust management, and financial planning services, as well as provides individual investment advice on equity and other securities. The company was founded in 1888 and is headquartered in Columbus, Georgia.
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Source: defenseworld.net
