Analyzing CNB Financial (NASDAQ:CCNE) and HSBC (NYSE:HSBC)

HSBC (NYSE:HSBC) and CNB Financial (NASDAQ:CCNE) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, profitability, risk and valuation.

Dividends

HSBC pays an annual dividend of $1.98 per share and has a dividend yield of 2.2%. CNB Financial pays an annual dividend of $0.76 per share and has a dividend yield of 2.1%. HSBC pays out 28.1% of its earnings in the form of a dividend. CNB Financial pays out 20.0% 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. CNB Financial has increased its dividend for 1 consecutive years.

Earnings & Valuation

This table compares HSBC and CNB Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HSBC	$131.35 billion	2.37	$22.29 billion	$7.05	12.86
CNB Financial	$432.51 million	2.42	$66.13 million	$3.80	9.30

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

Analyst Ratings

This is a breakdown of current ratings and target prices for HSBC and CNB Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HSBC	2	11	3	0	2.06
CNB Financial	0	2	4	0	2.67

HSBC currently has a consensus price target of $97.00, indicating a potential upside of 7.01%. CNB Financial has a consensus price target of $37.00, indicating a potential upside of 4.67%. Given HSBC’s higher possible upside, equities research analysts plainly believe HSBC is more favorable than CNB Financial.

Insider & Institutional Ownership

1.5% of HSBC shares are held by institutional investors. Comparatively, 52.3% of CNB Financial shares are held by institutional investors. 0.0% of HSBC shares are held by insiders. Comparatively, 2.9% of CNB Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares HSBC and CNB Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HSBC	18.19%	13.80%	0.83%
CNB Financial	23.26%	13.23%	1.30%

Risk & Volatility

HSBC has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500. Comparatively, CNB Financial has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500.

Summary

CNB Financial beats HSBC on 10 of the 17 factors compared between the two stocks.

About HSBC

HSBC Holdings plc provides banking and financial services worldwide. The company operates through Wealth and Personal Banking, Commercial Banking, and Global Banking and Markets segments. The Wealth and Personal Banking segment offers retail banking and wealth products, including current and savings accounts, mortgages and personal loans, credit and debit cards, and local and international payment services; and wealth management services comprising insurance and investment products, global asset management services, investment management, and private wealth solutions. This segment serves personal banking and high net worth individuals. The Commercial Banking segment provides credit and lending, treasury management, payment, cash management, commercial insurance, and investment services; commercial cards; international trade and receivables finance services; foreign exchange products; capital raising services on debt and equity markets; and advisory services. It serves small and medium sized enterprises, mid-market enterprises, and corporates. The Global Banking and Markets segment offers financing, advisory, and transaction services; and credit, rates, foreign exchange, equities, money markets, and securities services; and engages in principal investment activities. It serves government, corporate and institutional clients, and private investors. HSBC Holdings plc was founded in 1865 and is headquartered in London, the United Kingdom.

About CNB Financial

CNB Financial Corporation operates as the bank holding company for CNB Bank that provides a range of banking products and services for individual, business, governmental, and institutional customers. The company accepts checking, savings, and time deposit accounts; and offers real estate, commercial, industrial, residential, and consumer loans, as well as various other specialized financial services. It also provides private banking; and wealth and asset management services, including the administration of trusts and estates, retirement plans, and other employee benefit plans, as well as a range of wealth management services. In addition, the company invests in debt and equity securities; sells nonproprietary annuities and other insurance products; and offers small balance unsecured loans and secured loans primarily collateralized by automobiles and equipment, as well as engages in consumer discount loan and finance business. The company was founded in 1865 and is headquartered in Clearfield, Pennsylvania.