Critical Comparison: Swedbank (OTCMKTS:SWDBY) & Hingham Institution for Savings (NASDAQ:HIFS)

Hingham Institution for Savings (NASDAQ:HIFS) and Swedbank (OTCMKTS:SWDBY) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, dividends, risk and institutional ownership.

Dividends

Hingham Institution for Savings pays an annual dividend of $2.52 per share and has a dividend yield of 0.8%. Swedbank pays an annual dividend of SEK 1.48 per share and has a dividend yield of 3.7%. Hingham Institution for Savings pays out 8.4% of its earnings in the form of a dividend. Swedbank pays out 50.2% 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.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Hingham Institution for Savings and Swedbank, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hingham Institution for Savings	0	0	1	0	3.00
Swedbank	2	3	1	0	1.83

Institutional and Insider Ownership

49.3% of Hingham Institution for Savings shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Hingham Institution for Savings has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500. Comparatively, Swedbank has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500.

Profitability

This table compares Hingham Institution for Savings and Swedbank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hingham Institution for Savings	25.94%	8.22%	0.88%
Swedbank	29.45%	14.84%	0.99%

Valuation and Earnings

This table compares Hingham Institution for Savings and Swedbank”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hingham Institution for Savings	$236.78 million	2.76	$54.55 million	$30.02	10.00
Swedbank	$11.08 billion	4.11	$3.35 billion	SEK 2.95	13.71

Swedbank has higher revenue and earnings than Hingham Institution for Savings. Hingham Institution for Savings is trading at a lower price-to-earnings ratio than Swedbank, indicating that it is currently the more affordable of the two stocks.

Summary

Swedbank beats Hingham Institution for Savings on 8 of the 13 factors compared between the two stocks.

About Hingham Institution for Savings

Hingham Institution for Savings provides various financial products and services to individuals and small businesses in the United States. It offers savings, checking, money market, demand, and negotiable order of withdrawal accounts, as well as certificates of deposit. The company provides commercial and residential real estate, construction, home equity, commercial, consumer, and mortgage loans. In addition, it offers ATMs, debit cards, and Internet-based banking services. The company offers its services through a network of offices in Boston; Washington, D.C.; and San Francisco Bay Area. Hingham Institution for Savings was incorporated in 1834 and is headquartered in Hingham, Massachusetts.

About Swedbank

Swedbank AB (publ) provides various banking products and services to private and corporate customers in Sweden, Estonia, Latvia, Lithuania, Norway, the United States, Finland, Denmark, Luxembourg, and China. The company operates through three business areas: Swedish Banking, Baltic Banking, and Corporates and Institutions. It offers savings accounts, mutual funds and insurance savings, pension savings, institutional asset management, and other savings and investment products; private residential lending, consumer financing, corporate lending, leasing, and other financing products, as well as trade finance and factoring services; and current accounts, cash handling, debit and credit cards, and card acquiring, as well as domestic, international, mobile, document, and other payment products. The company also provides equity trading, structured products, corporate finance, custody services, fixed income and currency trading, and other capital market products; and administrative services, treasury operations, real estate brokerage and management services, legal services, safe deposit boxes, and other services. In addition, it offers pension insurance and plan, life, endowment insurance, and personal insurance products; investment management, investment banking, and mortgage lending services; and transaction banking services comprising cash management, securities, account, and clearing and settlement services, as well as Internet and mobile banking services. The company was formerly known as ForeningsSparbanken AB and changed its name to Swedbank AB (publ) in September 2006. Swedbank AB (publ) was founded in 1820 and is headquartered in Sundbyberg, Sweden.