Reviewing Midland States Bancorp (NASDAQ:MSBI) and Sumitomo Mitsui Financial Group (NYSE:SMFG)

Midland States Bancorp (NASDAQ:MSBI) and Sumitomo Mitsui Financial Group (NYSE:SMFG) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, dividends, risk, earnings and valuation.

Volatility and Risk

Midland States Bancorp has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500. Comparatively, Sumitomo Mitsui Financial Group has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500.

Insider and Institutional Ownership

60.9% of Midland States Bancorp shares are held by institutional investors. Comparatively, 3.8% of Sumitomo Mitsui Financial Group shares are held by institutional investors. 8.6% of Midland States Bancorp shares are held by company insiders. Comparatively, 0.1% of Sumitomo Mitsui Financial Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Dividends

Midland States Bancorp pays an annual dividend of $1.32 per share and has a dividend yield of 4.1%. Sumitomo Mitsui Financial Group pays an annual dividend of $0.47 per share and has a dividend yield of 1.9%. Midland States Bancorp pays out 84.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sumitomo Mitsui Financial Group pays out 32.6% of its earnings in the form of a dividend. Midland States Bancorp has raised its dividend for 1 consecutive years. Midland States Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Midland States Bancorp and Sumitomo Mitsui Financial Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Midland States Bancorp	$291.82 million	2.30	-$124.28 million	$1.56	20.74
Sumitomo Mitsui Financial Group	$71.68 billion	2.21	$7.84 billion	$1.44	17.39

Sumitomo Mitsui Financial Group has higher revenue and earnings than Midland States Bancorp. Sumitomo Mitsui Financial Group is trading at a lower price-to-earnings ratio than Midland States Bancorp, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Midland States Bancorp and Sumitomo Mitsui Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Midland States Bancorp	9.40%	13.32%	0.92%
Sumitomo Mitsui Financial Group	16.24%	10.65%	0.56%

Analyst Ratings

This is a summary of recent recommendations and price targets for Midland States Bancorp and Sumitomo Mitsui Financial Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Midland States Bancorp	0	5	0	0	2.00
Sumitomo Mitsui Financial Group	1	0	1	0	2.00

Midland States Bancorp presently has a consensus price target of $31.12, suggesting a potential downside of 3.79%. Given Midland States Bancorp’s higher possible upside, research analysts plainly believe Midland States Bancorp is more favorable than Sumitomo Mitsui Financial Group.

Summary

Midland States Bancorp beats Sumitomo Mitsui Financial Group on 11 of the 16 factors compared between the two stocks.

About Midland States Bancorp

Midland States Bancorp, Inc. operates as a financial holding company for Midland States Bank that provides various banking products and services to individuals, businesses, municipalities, and other entities. It operates through Banking, Wealth Management, and Other segments. The company provides a range of financial products and services to consumers and businesses, including commercial loans to finance agricultural equipment and production; and commercial real estate loans for owner occupied offices, warehouses and production facilities, office buildings, hotels, mixed-use residential and commercial facilities, retail centers, multifamily properties, and assisted living facilities. In addition, it offers construction and land development loans, such as real estate investment properties and residential developments, and lesser extent loans; and residential real estate loans, which includes first and second mortgage loans, and home equity lines of credit consisting of loans secured by first or second mortgages on primarily owner occupied primary residences. The company also provides consumer installment loans for the purchase of cars, boats and other recreational vehicles, as well as for the purchase of major appliances and other home improvement projects; and commercial equipment leasing programs for manufacturing, construction, transportation, and healthcare industries. Further, it offers merchant services; deposit products, including checking, time, savings, money market, and certificates of deposit, as well as sweep accounts; letters of credit; and trust and wealth management services, such as financial and estate planning, trustee and custodial, investment management, tax, insurance, and business planning, corporate retirement plan consulting and administration, and retail brokerage services. The company was founded in 1881 and is headquartered in Effingham, Illinois.

About Sumitomo Mitsui Financial Group

Sumitomo Mitsui Financial Group, Inc., together with its subsidiaries, provides banking, leasing, securities, credit card, and consumer finance services in Japan, the Americas, Europe, the Middle East, Asia, and Oceania. It operates through Wholesale Business Unit, Retail Business Unit, Global Business Unit, and Global Markets Business Unit segments. The company was incorporated in 2002 and is headquartered in Tokyo, Japan.