Critical comparison: Synovus Financial (NYSE: SNV) and UMB Financial (NASDAQ: UMBF)


Synovus Financial (NYSE: SNVGet a rating) and UMB Financial (NASDAQ: UMBFGet a rating) are both mid-cap finance companies, but which business is superior? We will compare the two companies based on the strength of their analyst recommendations, earnings, dividends, risk, institutional ownership, profitability and valuation.

Risk and Volatility

Synovus Financial has a beta of 1.44, indicating its stock price is 44% more volatile than the S&P 500. In comparison, UMB Financial has a beta of 0.92, indicating its stock price is 8% less volatile than the S&P 500.

Profitability

This table compares the net margins, return on equity and return on assets of Synovus Financial and UMB Financial.

Net margins Return on equity return on assets
Synovus Financial 35.38% 16.00% 1.32%
UMB Financial 26.95% 12.16% 0.93%

Benefits and evaluation

This table compares the revenue, earnings per share, and valuation of Synovus Financial and UMB Financial.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
Synovus Financial $2.10 billion 2.73 $760.47 million $4.82 8:20 am
UMB Financial $1.34 billion 3.26 $353.02 million $7.51 12:00 p.m.

Synovus Financial has higher revenue and profit than UMB Financial. Synovus Financial trades at a lower price-to-earnings ratio than UMB Financial, indicating that it is currently the more affordable of the two stocks.

Dividends

Synovus Financial pays an annual dividend of $1.36 per share and has a dividend yield of 3.4%. UMB Financial pays an annual dividend of $1.48 per share and has a dividend yield of 1.6%. Synovus Financial pays 28.2% of its profits as a dividend. UMB Financial distributes 19.7% of its profits as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings over the next few years. Synovus Financial increased its dividend for 1 consecutive year and UMB Financial increased its dividend for 18 consecutive years.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Synovus Financial and UMB Financial, as reported by MarketBeat.com.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
Synovus Financial 0 1 8 0 2.89
UMB Financial 0 1 2 0 2.67

Synovus Financial currently has a consensus target price of $53.45, indicating a potential upside of 35.32%. UMB Financial has a consensus target price of $107.67, indicating a potential upside of 19.46%. Given Synovus Financial’s stronger consensus rating and higher possible upside, analysts clearly believe that Synovus Financial is more favorable than UMB Financial.

Institutional and insider ownership

79.5% of Synovus Financial shares are held by institutional investors. Comparatively, 87.3% of UMB Financial shares are held by institutional investors. 1.6% of Synovus Financial shares are held by insiders. Comparatively, 9.8% of UMB Financial shares are held by insiders. Strong institutional ownership indicates that hedge funds, endowments, and large fund managers believe a company will outperform the market over the long term.

Summary

Synovus Financial beats UMB Financial on 10 out of 17 factors compared between the two stocks.

About Synovus Financial

(Get a rating)

Synovus Financial Corp. operates as a bank holding company for Synovus Bank which provides commercial and retail banking products and services. It operates through three segments: Community Banking, Wholesale Banking and Financial Management Services. The Company’s commercial banking services include cash management, asset management, capital market and institutional trust services, as well as commercial, financial and real estate lending. Its retail banking services include accepting the usual types of demand deposit and savings accounts; mortgage, installment and other consumer loans; investment and brokerage services; safety deposit box services; automated banking services; automated fund transfers; Internet banking services; and credit and debit card banking. The Company also offers a variety of other financial services, including fixed income portfolio management, investment banking, execution of securities transactions as a broker/dealer and financial planning services, as well as individual investment advice on stocks and other securities. As of December 31, 2020, it operated through 289 branches and 389 ATMs in Alabama, Florida, Georgia, South Carolina and Tennessee. The company was founded in 1888 and is based in Columbus, Georgia.

About UMB Financial

(Get a rating)

UMB Financial Corporation operates as a bank holding company for UMB bank which provides various banking and other financial services. The Commercial Banking segment provides commercial loans and credit cards; commercial real estate financing; letter of credit; loan syndication and advisory service; various business solutions, including asset-based lending, accounts receivable financing, mezzanine debt and minority equity investments; and cash management service, such as deposit service, account reconciliation, cash management tool, accounts payable and receivable solution, electronic funds transfer and automated payment, controlled disbursement, vault service and input service remote filing. The Institutional Banking segment offers asset management and healthcare services provided to institutional clients; and fund administration and accounting, investor service and transfer agency, marketing and distribution, custody, alternative investment service, fixed income sales, trading and underwriting, and corporate trust and escrow service , as well as institutional daycare. This segment also provides healthcare payment solution including custodial service for health savings accounts and private brands, multi-purpose debit cards to insurance companies, third-party administrators, software companies, employers and financial institutions. The Retail Banking segment offers deposit accounts, retail credit cards, private banking, installment loans, home equity lines of credit, residential mortgages and small business loans, as well as internet banking, an ATM network, private banking, brokerage and insurance, and advisory and trust services. It operates through a network of branches and offices in the states of Missouri, Kansas, Colorado, Illinois, Oklahoma, Texas, Arizona, Nebraska, Iowa, Pennsylvania, South Dakota, Indiana, Utah, Minnesota, California and Wisconsin. The company was founded in 1913 and is based in Kansas City, Missouri.



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