Banco Bradesco (NYSE:BBD) and United Community Banks (NASDAQ:UCB) Financial Analysis

United Community Banks (NASDAQ:UCB) and Banco Bradesco (NYSE:BBD) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, risk, institutional ownership, profitability, valuation and earnings.

Institutional and Insider Ownership

82.3% of United Community Banks shares are owned by institutional investors. 0.5% of United Community Banks shares are owned by company insiders. Comparatively, 0.3% of Banco Bradesco shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

United Community Banks has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, Banco Bradesco has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500.

Dividends

United Community Banks pays an annual dividend of $0.96 per share and has a dividend yield of 2.9%. Banco Bradesco pays an annual dividend of $0.03 per share and has a dividend yield of 1.4%. United Community Banks pays out 47.1% of its earnings in the form of a dividend. Banco Bradesco pays out 11.5% 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.

Profitability

This table compares United Community Banks and Banco Bradesco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Community Banks	16.48%	8.64%	1.04%
Banco Bradesco	7.43%	10.17%	0.86%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for United Community Banks and Banco Bradesco, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Community Banks	0	2	1	0	2.33
Banco Bradesco	0	2	2	0	2.50

United Community Banks currently has a consensus price target of $33.33, indicating a potential upside of 0.58%. Banco Bradesco has a consensus price target of $2.55, indicating a potential upside of 20.57%. Given Banco Bradesco’s stronger consensus rating and higher possible upside, analysts clearly believe Banco Bradesco is more favorable than United Community Banks.

Valuation & Earnings

This table compares United Community Banks and Banco Bradesco”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Community Banks	$1.50 billion	2.63	$252.40 million	$2.04	16.25
Banco Bradesco	$39.41 billion	0.57	$2.85 billion	$0.26	8.13

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

About United Community Banks

United Community Banks, Inc. operates as the financial holding company for United Community Bank that provides financial products and services to commercial, retail, government, education, energy, health care, and real estate sectors. It accepts various deposit products, including checking, savings, money market, and other deposit accounts. The company also offers lending services, including real estate, consumer, and commercial loans, to individuals, small businesses, mid-sized commercial businesses, and non-profit organizations, as well as secured and unsecured, and mortgage loans. In addition, it originates loans partially guaranteed by the SBA and USDA loan programs. Further, the company provides wealth management services comprising financial planning, customized portfolio management, and investment advice; trust services to manage fiduciary assets; non-deposit investment products; and insurance products, including life insurance, long-term care insurance, and tax-deferred annuities, as well as invests in residential and commercial mortgage-backed securities, asset-backed securities, the U.S. treasury, the U.S. agency, and municipal obligations. Additionally, it offers reinsurance on a property insurance contract; insurance agency services; treasury management; credit cards; payment and commerce solution, equipment finance, investment advisory, and other related financial services; brokerage services; and payment processing, merchant, wire transfer, private banking, and other related financial services. The company was founded in 1950 and is headquartered in Blairsville, Georgia.

About Banco Bradesco

Banco Bradesco S.A., together with its subsidiaries, provides various banking products and services to individuals, corporates, and businesses in Brazil and internationally. The company operates through two segments, Banking and Insurance. It provides current, savings, click, and salary accounts; real estate credit, vehicle financing, payroll loans, mortgage loans, microcredit, leasing, and personal and installment credit; overdraft and agribusiness loans; debit and business cards; financial and security services; consortium products; car, personal accident, dental, travel, and life insurance; investment products; pension products; foreign currency exchange services; capitalization bonds; and internet banking services. Banco Bradesco S.A. was founded in 1943 and is headquartered in Osasco, Brazil.