Head-To-Head Analysis: CapStar Financial (NASDAQ:CSTR) & China Minsheng Banking (OTCMKTS:CGMBF)

CapStar Financial (NASDAQ:CSTR) and China Minsheng Banking (OTCMKTS:CGMBF) are both financial services companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, risk, analyst recommendations, dividends, valuation and profitability.

Insider & Institutional Ownership

52.2% of CapStar Financial shares are held by institutional investors. Comparatively, 3.6% of China Minsheng Banking shares are held by institutional investors. 9.2% of CapStar Financial shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares CapStar Financial and China Minsheng Banking’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CapStar Financial	$112.03 million	3.73	$29.80 million	$1.41	14.26
China Minsheng Banking	N/A	N/A	N/A	$1.27	0.24

CapStar Financial has higher revenue and earnings than China Minsheng Banking. China Minsheng Banking is trading at a lower price-to-earnings ratio than CapStar Financial, indicating that it is currently the more affordable of the two stocks.

Dividends

CapStar Financial pays an annual dividend of $0.44 per share and has a dividend yield of 2.2%. China Minsheng Banking pays an annual dividend of $0.10 per share and has a dividend yield of 32.7%. CapStar Financial pays out 31.2% of its earnings in the form of a dividend. China Minsheng Banking pays out 8.0% 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. CapStar Financial has increased its dividend for 3 consecutive years. China Minsheng Banking is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of current ratings and price targets for CapStar Financial and China Minsheng Banking, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CapStar Financial	0	0	0	0	N/A
China Minsheng Banking	0	0	0	0	N/A

CapStar Financial presently has a consensus target price of $15.38, indicating a potential downside of 23.51%. Given CapStar Financial’s higher possible upside, research analysts plainly believe CapStar Financial is more favorable than China Minsheng Banking.

Profitability

This table compares CapStar Financial and China Minsheng Banking’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CapStar Financial	16.17%	8.46%	0.93%
China Minsheng Banking	N/A	N/A	N/A

Summary

CapStar Financial beats China Minsheng Banking on 10 of the 12 factors compared between the two stocks.

About CapStar Financial

CapStar Financial Holdings, Inc. operates as the bank holding company for CapStar Bank that provides banking and other financial services to individuals and corporate customers in Tennessee, the United States. It offers noninterest-bearing demand deposits, interest-bearing transaction accounts, money market accounts, savings accounts, and time deposits; mortgage banking products; and wealth management and treasury management services. The company also provides commercial and residential real estate, construction and land development, commercial and industrial, consumer, non-owner-occupied real estate, home equity, paycheck protection program (PPP), and other loans, as well as business term loans, equipment financing, and lines of credit to small and medium sized businesses. In addition, it offers mobile banking services; and debit and credit cards. CapStar Financial Holdings, Inc. was founded in 2007 and is headquartered in Nashville, Tennessee.

About China Minsheng Banking

China Minsheng Banking Corp., Ltd. provides various financial products and services to individuals, small and micro-enterprises, corporate customers, government agencies, and financial institutions in the People's Republic of China. The company operates through Corporate Banking, Retail Banking, and Others segments. Its deposit products include saving accounts, deposit certificates, contracted deposits, agreement deposits, call deposits, corporate term deposits, and corporate current deposits. The company also offers personal housing mortgage, individual automobile purchase, household composite consumption, home, medium and long term, and short-term working capital loans; micro-credit products for individuals; debit and credit cards; and safe deposit boxes. In addition, it provides payment and collection agent, and clearing services, as well as internet, mobile, and telephone banking services. Further, the company offers gross settlement; wages distribution agency and letter of guarantee; cash management; trade finance; industrial chain finance; individual forex settlement, forex remittance, travelers promissory notes, collection, individual deposit certificate, and guarantee letter products; and comprehensive credit granting, forex settlement and sale, financial product investment, and trust financing services. Additionally, it provides convenient finance, investment banking, and asset management services, as well as non-financial services in the education, business travel, traveler, art, luxury life, health, club, and isports areas. The company has branch-level institutions, business outlets, community sub-branches, and small business sub-branches. China Minsheng Banking Corp., Ltd. was incorporated in 1996 and is headquartered in Beijing, the People's Republic of China.