SmartFinancial (NASDAQ:SMBK) versus Industrial and Commercial Bank of China (OTCMKTS:IDCBY) Financial Analysis

Industrial and Commercial Bank of China (OTCMKTS:IDCBY) and SmartFinancial (NASDAQ:SMBK) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, valuation, institutional ownership, profitability and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and target prices for Industrial and Commercial Bank of China and SmartFinancial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Industrial and Commercial Bank of China	0	0	0	0	0.00
SmartFinancial	0	4	0	1	2.40

SmartFinancial has a consensus price target of $30.70, suggesting a potential downside of 11.62%. Given SmartFinancial’s stronger consensus rating and higher probable upside, analysts plainly believe SmartFinancial is more favorable than Industrial and Commercial Bank of China.

Insider and Institutional Ownership

58.8% of SmartFinancial shares are held by institutional investors. 7.7% of SmartFinancial shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Industrial and Commercial Bank of China pays an annual dividend of $0.61 per share and has a dividend yield of 4.5%. SmartFinancial pays an annual dividend of $0.32 per share and has a dividend yield of 0.9%. Industrial and Commercial Bank of China pays out 22.3% of its earnings in the form of a dividend. SmartFinancial pays out 15.0% 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.

Profitability

This table compares Industrial and Commercial Bank of China and SmartFinancial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Industrial and Commercial Bank of China	23.22%	9.37%	0.77%
SmartFinancial	12.67%	7.33%	0.71%

Volatility and Risk

Industrial and Commercial Bank of China has a beta of 0.07, meaning that its stock price is 93% less volatile than the S&P 500. Comparatively, SmartFinancial has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500.

Valuation & Earnings

This table compares Industrial and Commercial Bank of China and SmartFinancial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Industrial and Commercial Bank of China	$218.31 billion	1.11	$51.43 billion	$2.73	5.00
SmartFinancial	$285.27 million	2.06	$36.14 million	$2.14	16.23

Industrial and Commercial Bank of China has higher revenue and earnings than SmartFinancial. Industrial and Commercial Bank of China is trading at a lower price-to-earnings ratio than SmartFinancial, indicating that it is currently the more affordable of the two stocks.

Summary

SmartFinancial beats Industrial and Commercial Bank of China on 9 of the 16 factors compared between the two stocks.

About Industrial and Commercial Bank of China

Industrial and Commercial Bank of China Limited, together with its subsidiaries, provides banking products and services in the People's Republic of China and internationally. The company operates through Corporate Banking, Personal Banking, and Treasury Operations segments. The Corporate Banking segment offers financial products and services to corporations, government agencies, and financial institutions. Its products and services include trade financing, deposit, corporate wealth management, custody, and various corporate intermediary services, as well as corporate loans. Its Personal Banking segment provides financial products and services to individual customers. This segment's products and services comprise personal loans and cards, deposits, and personal wealth management and intermediary services. The Treasury Business segment is involved in the money market transactions, investment securities, and proprietary and foreign exchange transactions businesses. It also offers e-banking services, investment banking, financial leasing, and insurance services. Industrial and Commercial Bank of China Limited was incorporated in 1984 and is based in Beijing, the People's Republic of China.

About SmartFinancial

SmartFinancial, Inc. operates as the bank holding company for SmartBank that provides various financial services to individuals and corporate customers in Tennessee, Alabama, and Florida. It operates through Commercial Real Estate, Consumer Real Estate, Construction and Land Development, Commercial and Industrial, Leases, and Consumer and Other segments. The company offers noninterest-bearing and interest-bearing checking, interest-bearing demand, savings, money market, time deposit, individual retirement accounts, as well as certificates of deposit. It also provides commercial and residential real estate, consumer real estate, and construction and land development loans; commercial and financial loans and leases; commercial business and mortgage loans; and direct consumer installment, educational, agriculture, and other revolving credit loans; equipment financing, heavy equipment, semis, and trailers loans and leases to small and mid-size companies; letters of credit; and overdraft facilities. In addition, the company offers wealth management, insurance, mortgage origination, and internet and mobile banking services. SmartFinancial, Inc. is headquartered in Knoxville, Tennessee.