Commerce Bancshares (NASDAQ:CBSH) and M&T Bank (NYSE:MTB)


M&T Bank (NYSE: MTBGet a rating) and Commerce Bancshares (NASDAQ: CBSHGet a rating) are both finance companies, but which company is better? We will compare the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, dividends, earnings and valuation.

Dividends

M&T Bank pays an annual dividend of $4.80 per share and has a dividend yield of 3.0%. Commerce Bancshares pays an annual dividend of $1.06 per share and has a dividend yield of 1.6%. M&T Bank pays 36.7% of its profits as a dividend. Commerce Bancshares pays 25.1% 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. M&T Bank increased its dividend for 1 consecutive year and Commerce Bancshares increased its dividend for 1 consecutive year.

Analyst Notes

This is a breakdown of recent ratings and target prices for M&T Bank and Commerce Bancshares, as reported by MarketBeat.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
M&T Bank 0 6 seven 0 2.54
Bancshares Trading 1 2 0 0 1.67

M&T Bank currently has a consensus price target of $193.31, suggesting a potential upside of 21.64%. Commerce Bancshares has a consensus price target of $66.62, suggesting a potential downside of 0.77%. Given M&T Bank’s stronger consensus rating and higher likely upside, equity research analysts clearly believe that M&T Bank is more favorable than Commerce Bancshares.

Risk and Volatility

M&T Bank has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500. In comparison, Commerce Bancshares has a beta of 0.81, indicating that its stock price stock is 19% less volatile than the S&P 500.

Profitability

This table compares the net margins, return on equity and return on assets of M&T Bank and Commerce Bancshares.

Net margins Return on equity return on assets
M&T Bank 29.31% 11.45% 1.20%
Bancshares Trading 36.83% 15.45% 1.48%

Benefits and evaluation

This table compares revenue, earnings per share and valuation of M&T Bank and Commerce Bancshares.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
M&T Bank $6.11 billion 4.67 $1.86 billion $13.09 12.14
Bancshares Trading $1.41 billion 5.75 $530.77 million $4.22 15.89

M&T Bank has higher revenue and profit than Commerce Bancshares. M&T Bank trades at a lower price-to-earnings ratio than Commerce Bancshares, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

87.6% of M&T Bank shares are held by institutional investors. Comparatively, 67.9% of Commerce Bancshares shares are held by institutional investors. 0.7% of M&T Bank shares are held by insiders of the company. Comparatively, 3.2% of Commerce Bancshares shares are held by company insiders. Strong institutional ownership indicates that large fund managers, endowments, and hedge funds believe a stock is poised for long-term growth.

Summary

M&T Bank beats Commerce Bancshares on 9 out of 16 factors compared between the two stocks.

About M&T Bank (Get a rating)

M&T Bank Corporation operates as a bank holding company that provides commercial and retail banking services. The Company’s Business Banking segment provides deposit, lending, cash management and other financial services to small businesses and professionals. Its Commercial Banking segment provides deposit products, commercial loans and leases, letters of credit and cash management services to medium and large commercial enterprises. The Company’s commercial real estate segment originates, sells and services commercial real estate loans; and offers deposit services. Its discretionary portfolio segment provides deposits; securities, residential real estate loans and other assets; and short-term and long-term borrowed funds, as well as foreign exchange services. The Company’s Residential Mortgage Banking segment offers residential real estate loans to consumers and sells these loans in the secondary market; and purchases service rights on loans issued by other entities. Its Retail Banking segment offers current, savings and term accounts; consumer installment loans, auto and recreational finance loans, home equity loans and lines of credit, and credit cards; mutual funds and annuities; and other services. The company also offers trust management and wealth management services; trustee and custodian; Insurance Agency; institutional brokerage and securities; and investment management services. It offers its services through bank offices, business banking centers, telephone and internet banking, and automated banking machines. As of December 31, 2021, the company operated 688 national banking offices in New York State, Maryland, New Jersey, Pennsylvania, Delaware, Connecticut, Virginia, West Virginia, and the District of Columbia; and a full-service commercial banking office in Ontario, Canada. M&T Bank Corporation was founded in 1856 and is headquartered in Buffalo, New York.

About Commerce Bancshares (Get a rating)

Commerce Bancshares, Inc. operates as a banking holding company for Commerce Bank which provides retail banking, mortgage banking, corporate, investment, trust and asset management products and services to individuals and to businesses in the United States. It operates through three segments: Consumer, Commercial and Wealth. The Consumer segment offers various banking products and services, including consumer deposits; consumer loans, such as automobile, motorcycle, marine, tractor/trailer, recreational vehicle, fixed and revolving, and other consumer loans; patient health care funding; real estate loans; indirect financing and other consumer financing; personal mortgage banking services; consumer installment loans; and consumer credit and debit cards. The Commercial segment provides business lending, leasing, international, business and commercial bank cards, securities custody and bond accounting services; and commercial products, government deposits and related commercial cash management services, as well as the sale of fixed income securities to correspondent banks, corporations, public institutions, municipalities and individuals. The Wealth segment offers traditional trust and estate planning, advisory and discretionary investment portfolio management, brokerage, and private banking accounts. The Company also offers private equity investment, securities brokerage, insurance agency, specialty lending and leasing services, as well as online and mobile banking. It operates through a network of 287 locations in Missouri, Kansas, Illinois, Oklahoma and Colorado, as well as sales offices. Commerce Bancshares, Inc. was founded in 1865 and is headquartered in Kansas City, Missouri.



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