Head to Head Contrast: Banco Bradesco (NYSE:BBDO) & First Business Financial Services (NASDAQ:FBIZ)

Banco Bradesco (NYSE:BBDO) and First Business Financial Services (NASDAQ:FBIZ) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Analyst Ratings

This is a summary of current ratings for Banco Bradesco and First Business Financial Services, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Bradesco	0	0	0	0	0.00
First Business Financial Services	0	0	4	0	3.00

First Business Financial Services has a consensus price target of $58.75, indicating a potential upside of 24.05%. Given First Business Financial Services’ stronger consensus rating and higher probable upside, analysts plainly believe First Business Financial Services is more favorable than Banco Bradesco.

Dividends

Banco Bradesco pays an annual dividend of $0.02 per share and has a dividend yield of 1.0%. First Business Financial Services pays an annual dividend of $1.16 per share and has a dividend yield of 2.4%. Banco Bradesco pays out 6.7% of its earnings in the form of a dividend. First Business Financial Services pays out 22.2% 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. First Business Financial Services has raised its dividend for 13 consecutive years. First Business Financial Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Banco Bradesco has a beta of 0.71, suggesting that its share price is 29% less volatile than the S&P 500. Comparatively, First Business Financial Services has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500.

Insider and Institutional Ownership

60.1% of First Business Financial Services shares are owned by institutional investors. 0.3% of Banco Bradesco shares are owned by company insiders. Comparatively, 5.1% of First Business Financial Services shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Banco Bradesco and First Business Financial Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Bradesco	8.46%	11.43%	0.95%
First Business Financial Services	16.86%	14.33%	1.16%

Valuation & Earnings

This table compares Banco Bradesco and First Business Financial Services”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Bradesco	$105.33 billion	0.21	$3.20 billion	$0.30	6.80
First Business Financial Services	$153.46 million	2.56	$44.24 million	$5.22	9.07

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

Summary

First Business Financial Services beats Banco Bradesco on 13 of the 17 factors compared between the two stocks.

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.

About First Business Financial Services

First Business Financial Services, Inc. operates as the bank holding company for First Business Bank that provides commercial banking products and services for small and medium-sized businesses, business owners, executives, professionals, and high net worth individuals in Wisconsin, Kansas, and Missouri. The company offers real estate lending, commercial and industrial lending, asset-based lending, accounts receivable financing, equipment financing loans and leases, floorplan financing, vendor financing, small business administration lending and servicing, treasury management solutions, and company retirement services. It also provides private wealth management for individuals, including creating and executing asset allocation strategies, trust and estate administration, financial planning, investment management, and access to brokerage and custody-only services. In addition, the company offers bank consulting consisting of investment portfolio administrative and asset liability management services, and commercial deposit accounts. The company was founded in 1909 and is headquartered in Madison, Wisconsin.