Trustmark (NASDAQ:TRMK) vs. Hancock Whitney (NASDAQ:HWC) Critical Review

Hancock Whitney (NASDAQ:HWC) and Trustmark (NASDAQ:TRMK) are both mid-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, dividends, analyst recommendations and risk.

Insider & Institutional Ownership

81.2% of Hancock Whitney shares are owned by institutional investors. Comparatively, 67.6% of Trustmark shares are owned by institutional investors. 0.9% of Hancock Whitney shares are owned by insiders. Comparatively, 1.7% of Trustmark shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Hancock Whitney and Trustmark’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hancock Whitney	20.51%	11.65%	1.40%
Trustmark	20.90%	10.78%	1.20%

Risk and Volatility

Hancock Whitney has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500. Comparatively, Trustmark has a beta of 0.69, indicating that its stock price is 31% less volatile than the S&P 500.

Dividends

Hancock Whitney pays an annual dividend of $2.00 per share and has a dividend yield of 3.1%. Trustmark pays an annual dividend of $1.00 per share and has a dividend yield of 2.1%. Hancock Whitney pays out 40.2% of its earnings in the form of a dividend. Trustmark pays out 25.0% 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. Hancock Whitney has increased its dividend for 3 consecutive years and Trustmark has increased its dividend for 1 consecutive years. Hancock Whitney is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of current recommendations for Hancock Whitney and Trustmark, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hancock Whitney	0	4	6	1	2.73
Trustmark	0	4	1	1	2.50

Hancock Whitney presently has a consensus target price of $81.95, suggesting a potential upside of 25.54%. Trustmark has a consensus target price of $47.38, suggesting a potential downside of 1.05%. Given Hancock Whitney’s stronger consensus rating and higher probable upside, analysts clearly believe Hancock Whitney is more favorable than Trustmark.

Earnings and Valuation

This table compares Hancock Whitney and Trustmark”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hancock Whitney	$2.02 billion	2.57	$486.07 million	$4.97	13.13
Trustmark	$1.12 billion	2.46	$224.13 million	$4.00	11.97

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

Summary

Hancock Whitney beats Trustmark on 14 of the 17 factors compared between the two stocks.

About Hancock Whitney

Hancock Whitney is a bank holding company headquartered in Gulfport, Mississippi, whose principal subsidiary is Hancock Whitney Bank. The company provides personal and business banking services, including deposit accounts, loans, treasury management, mortgage lending, and online and mobile banking. It also offers wealth management, trust, and investment services. The bank serves customers across the Gulf South, with operations in Mississippi, Louisiana, Alabama, Florida, and Texas. Its history includes roots in Hancock County Bank, founded in Bay St. Louis, Mississippi, in 1899, and Whitney National Bank, established in New Orleans in 1883.

About Trustmark

Trustmark Corporation is a bank holding company headquartered in Jackson, Mississippi. Through its subsidiary, Trustmark National Bank, the company provides commercial and consumer banking services, including deposit accounts, lending, cash management and digital banking. Trustmark also offers wealth management and insurance services to individuals and businesses. Its insurance operations provide services such as employee benefits and risk management. Founded in 1889, Trustmark serves customers across the southeastern United States, with a presence in Mississippi, Alabama, Florida, Tennessee and Texas.