Analyzing United Security Bancshares (NASDAQ:UBFO) and Banco Bradesco (NYSE:BBDO)

Banco Bradesco (NYSE:BBDO) and United Security Bancshares (NASDAQ:UBFO) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, earnings, risk, dividends and valuation.

Dividends

Banco Bradesco pays an annual dividend of $0.03 per share and has a dividend yield of 1.0%. United Security Bancshares pays an annual dividend of $0.48 per share and has a dividend yield of 4.6%. Banco Bradesco pays out 7.1% of its earnings in the form of a dividend. United Security Bancshares pays out 67.6% 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. United Security Bancshares has increased its dividend for 2 consecutive years. United Security Bancshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

30.9% of United Security Bancshares shares are owned by institutional investors. 0.3% of Banco Bradesco shares are owned by company insiders. Comparatively, 22.1% of United Security Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Banco Bradesco and United Security Bancshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Bradesco	0	1	0	0	2.00
United Security Bancshares	0	0	1	0	3.00

Profitability

This table compares Banco Bradesco and United Security Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Bradesco	10.20%	14.61%	1.11%
United Security Bancshares	18.65%	9.03%	1.01%

Earnings & Valuation

This table compares Banco Bradesco and United Security Bancshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Bradesco	$41.79 billion	0.79	$4.24 billion	$0.42	7.44
United Security Bancshares	$53.51 million	3.39	$12.29 million	$0.71	14.80

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

Volatility & Risk

Banco Bradesco has a beta of 0.54, suggesting that its share price is 46% less volatile than the S&P 500. Comparatively, United Security Bancshares has a beta of 0.34, suggesting that its share price is 66% less volatile than the S&P 500.

Summary

United Security Bancshares beats Banco Bradesco on 10 of the 16 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 United Security Bancshares

United Security Bancshares operates as the bank holding company for United Security Bank, a state-chartered bank that provides a range of commercial banking services to the business and professional community, and individuals in California. The company accepts various deposit products, including personal and business checking accounts, savings accounts, interest-bearing negotiable order of withdrawal accounts, money market accounts, and time certificates of deposit. It also provides real estate mortgage, commercial and industrial, real estate construction and development, and consumer loans, as well as agricultural, installment, and student loans. In addition, the company offers online and mobile banking, safe deposit boxes, wire transfers, payroll direct deposit, cashier's check, cash management, and foreign draft services, as well as interactive teller machines; and person-to-person and bank-to-bank transfers for consumer customers. United Security Bancshares was founded in 1987 and is headquartered in Fresno, California.