Bank of Nova Scotia (NYSE:BNS) & Atlantic Capital Bancshares (NYSE:ACBI) Head to Head Analysis

Bank of Nova Scotia (NYSE:BNS) and Atlantic Capital Bancshares (NASDAQ:ACBI) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.

Earnings and Valuation

This table compares Bank of Nova Scotia and Atlantic Capital Bancshares’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Bank of Nova Scotia $35.10 billion 1.92 $6.31 billion $5.37 10.33
Atlantic Capital Bancshares $104.81 million 3.74 $28.53 million $1.08 16.59

Bank of Nova Scotia has higher revenue and earnings than Atlantic Capital Bancshares. Bank of Nova Scotia is trading at a lower price-to-earnings ratio than Atlantic Capital Bancshares, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and target prices for Bank of Nova Scotia and Atlantic Capital Bancshares, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bank of Nova Scotia 0 6 3 0 2.33
Atlantic Capital Bancshares 0 2 2 0 2.50

Bank of Nova Scotia presently has a consensus target price of $76.75, indicating a potential upside of 38.36%. Atlantic Capital Bancshares has a consensus target price of $19.00, indicating a potential upside of 6.03%. Given Bank of Nova Scotia’s higher probable upside, research analysts clearly believe Bank of Nova Scotia is more favorable than Atlantic Capital Bancshares.

Insider and Institutional Ownership

46.9% of Bank of Nova Scotia shares are held by institutional investors. Comparatively, 86.1% of Atlantic Capital Bancshares shares are held by institutional investors. 3.6% of Atlantic Capital Bancshares shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Bank of Nova Scotia and Atlantic Capital Bancshares’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bank of Nova Scotia 17.99% 13.65% 0.85%
Atlantic Capital Bancshares 45.08% 8.82% 1.09%

Volatility and Risk

Bank of Nova Scotia has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500. Comparatively, Atlantic Capital Bancshares has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500.

Summary

Bank of Nova Scotia beats Atlantic Capital Bancshares on 8 of the 14 factors compared between the two stocks.

About Bank of Nova Scotia

The Bank of Nova Scotia provides various banking products and services in North America, Latin America, the Caribbean and Central America, and the Asia-Pacific. The company offers financial advice and solutions, and day-to-day banking products, including debit and credit cards, chequing and saving accounts, investments, mortgages, loans, and related creditor insurance to individuals and small businesses; and commercial banking solutions comprising lending, deposit, cash management, and trade finance solutions to medium and large businesses, including automotive dealers and their customers. It is also involved in the provision of investment and wealth management advice, services, products, and solutions to customers and advisors; wealth management solutions, such as private customer, online brokerage, full-service brokerage, pension, and institutional customer services, as well as asset management business focusing on developing investment solutions for retail and institutional investors; and international banking services for retail, corporate, and commercial customers. In addition, the company offers corporate lending; trade finance and cash management; investment banking services, including corporate finance, and mergers and acquisitions; fixed income and equity underwriting, sales, trading, and research services; prime brokerage and stock lending services; foreign exchange sales and trading services; commodity derivatives sales and trading; and collateral management services for corporate, government, and institutional investor clients. Further, it provides Internet, mobile, and telephone banking services. The company operates a network of 955 branches and approximately 3,644 automated banking machines in Canada; and approximately 1,800 branches internationally, as well as contact and business support centers. The Bank of Nova Scotia was founded in 1832 and is headquartered in Toronto, Canada.

About Atlantic Capital Bancshares

Atlantic Capital Bancshares, Inc. operates as the bank holding company for Atlantic Capital Bank, N.A. that provides banking products and services in the Metropolitan Atlanta and rest of the United States. The company offers non-interest and interest bearing demand, savings and money market, time, and brokered deposits; and NOW accounts. It also provides working capital and equipment loans, loans supported by owner-occupied real estate, revolving lines of credit, term loans, and letters of credit; secured installment and term loans, and home equity lines of credit; and commercial real estate loans, including secured construction loans, secured mini-permanent loans, and secured or unsecured lines of credit. In addition, the company offers cash and treasury management, capital market, payment processing, specialty commercial lending, small business administration and franchise lending, payroll, electronic payment, and online and mobile banking services. It serves small and mid-sized businesses, franchisees, commercial enterprises, not for profit institutions, institutional caliber commercial real estate developers and investors, public real estate investment trusts and other commercial real estate clients, and individuals and professional services businesses. The company primarily operates a loan production office Athens, Georgia; and 16 additional locations located in Fulton, Whitfield, and Oconee County, Georgia, as well as Hamilton, Union, Jefferson, Knox, and Loudon County, Tennessee. The company was founded in 2006 and is headquartered in Atlanta, Georgia.

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