Critical Analysis: Civista Bancshares (NASDAQ:CIVB) & HDFC Bank (NYSE:HDB)
by Danessa Lincoln · The Markets DailyCivista Bancshares (NASDAQ:CIVB – Get Free Report) and HDFC Bank (NYSE:HDB – Get Free Report) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, dividends and profitability.
Institutional & Insider Ownership
52.1% of Civista Bancshares shares are owned by institutional investors. Comparatively, 17.6% of HDFC Bank shares are owned by institutional investors. 1.6% of Civista Bancshares shares are owned by insiders. Comparatively, 1.0% of HDFC Bank shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Earnings & Valuation
This table compares Civista Bancshares and HDFC Bank”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Civista Bancshares | $182.43 million | 3.12 | $46.21 million | $2.70 | 10.14 |
| HDFC Bank | $54.16 billion | 2.14 | $7.51 billion | $1.70 | 13.28 |
HDFC Bank has higher revenue and earnings than Civista Bancshares. Civista Bancshares is trading at a lower price-to-earnings ratio than HDFC Bank, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Civista Bancshares and HDFC Bank’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Civista Bancshares | 20.79% | 10.65% | 1.35% |
| HDFC Bank | 15.96% | 11.84% | 1.64% |
Dividends
Civista Bancshares pays an annual dividend of $0.72 per share and has a dividend yield of 2.6%. HDFC Bank pays an annual dividend of $0.34 per share and has a dividend yield of 1.5%. Civista Bancshares pays out 26.7% of its earnings in the form of a dividend. HDFC Bank pays out 20.0% 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. Civista Bancshares has increased its dividend for 4 consecutive years. Civista Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Volatility and Risk
Civista Bancshares has a beta of 0.65, indicating that its share price is 35% less volatile than the S&P 500. Comparatively, HDFC Bank has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500.
Analyst Ratings
This is a breakdown of recent ratings and target prices for Civista Bancshares and HDFC Bank, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Civista Bancshares | 0 | 3 | 3 | 0 | 2.50 |
| HDFC Bank | 0 | 3 | 1 | 0 | 2.25 |
Civista Bancshares presently has a consensus price target of $30.25, suggesting a potential upside of 10.44%. Given Civista Bancshares’ stronger consensus rating and higher probable upside, analysts plainly believe Civista Bancshares is more favorable than HDFC Bank.
Summary
Civista Bancshares beats HDFC Bank on 11 of the 17 factors compared between the two stocks.
About Civista Bancshares
Civista Bancshares, Inc. operates as the financial holding company for Civista Bank that provides community banking services. It collects a range of customer deposits; and offers commercial and agriculture, commercial and residential real estate, farm real estate, real estate construction, consumer, and other loans, as well as letters of credit. The company also holds and manages securities portfolio; leases general equipment; and provides captive insurance products. It operates in North Central, West Central, South Western Ohio, South Eastern Indiana, and Northern Kentucky. The company was formerly known as First Citizens Banc Corp and changed its name to Civista Bancshares, Inc. in May 2015. Civista Bancshares, Inc. was founded in 1884 and is headquartered in Sandusky, Ohio.
About HDFC Bank
HDFC Bank Limited provides banking and financial services to individuals and businesses in India, Bahrain, Hong Kong, and Dubai. The company operates in three segments: Wholesale Banking, Retail Banking, and Treasury Services. It accepts savings, salary, current, rural, public provident fund, pension, and demat accounts; fixed and recurring deposits; and safe deposit lockers, as well as offshore accounts and deposits, and overdrafts against fixed deposits. The company also provides personal, home, car, two-wheeler, business, doctor, educational, gold, consumer, and rural loans; loans against properties, securities, fixed deposits, rental receivables, and assets; loans for professionals; government sponsored programs; and loans on credit card, as well as working capital and commercial/construction equipment finance, healthcare/medical equipment and commercial vehicle finance, dealer finance, and term loans. In addition, it offers credit, debit, prepaid, and forex cards; payment and collection, export, import, remittance, bank guarantee, letter of credit, trade, hedging, and merchant and cash management services; insurance and investment products. Further, the company provides short term finance, bill discounting, structured finance, export credit, loan repayment, and documents collection services; online and wholesale, mobile, and phone banking services; unified payment interface, immediate payment, national electronic funds transfer, and real time gross settlement services; and channel financing, vendor financing, reimbursement account, money market, derivatives, employee trusts, cash surplus corporates, tax payment, and bankers to rights/public issue services, as well as financial solutions for supply chain partners and agricultural customers. It operates branches and automated teller machines in various cities/towns. The company was incorporated in 1994 and is headquartered in Mumbai, India.