SunTrust Banks (STI) and Its Competitors Critical Survey

SunTrust Banks (NYSE: STI) is one of 320 publicly-traded companies in the “Banks” industry, but how does it compare to its rivals? We will compare SunTrust Banks to similar companies based on the strength of its valuation, analyst recommendations, profitability, risk, institutional ownership, dividends and earnings.

Dividends

SunTrust Banks pays an annual dividend of $1.60 per share and has a dividend yield of 2.8%. SunTrust Banks pays out 41.0% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 2.0% and pay out 34.7% of their earnings in the form of a dividend. SunTrust Banks has raised its dividend for 4 consecutive years.

Risk & Volatility

SunTrust Banks has a beta of 1.29, suggesting that its share price is 29% more volatile than the S&P 500. Comparatively, SunTrust Banks’ rivals have a beta of 0.79, suggesting that their average share price is 21% less volatile than the S&P 500.

Profitability

This table compares SunTrust Banks and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SunTrust Banks 20.88% 8.83% 0.96%
SunTrust Banks Competitors 18.51% 8.53% 0.92%

Valuation & Earnings

This table compares SunTrust Banks and its rivals top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
SunTrust Banks $9.16 billion $1.88 billion 14.56
SunTrust Banks Competitors $5.50 billion $822.45 million 354.45

SunTrust Banks has higher revenue and earnings than its rivals. SunTrust Banks is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for SunTrust Banks and its rivals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SunTrust Banks 0 16 9 0 2.36
SunTrust Banks Competitors 2086 8228 8299 324 2.36

SunTrust Banks presently has a consensus target price of $62.97, suggesting a potential upside of 10.89%. As a group, “Banks” companies have a potential downside of 4.05%. Given SunTrust Banks’ higher probable upside, research analysts clearly believe SunTrust Banks is more favorable than its rivals.

Institutional and Insider Ownership

82.3% of SunTrust Banks shares are owned by institutional investors. Comparatively, 51.7% of shares of all “Banks” companies are owned by institutional investors. 0.6% of SunTrust Banks shares are owned by insiders. Comparatively, 10.5% of shares of all “Banks” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

SunTrust Banks beats its rivals on 9 of the 15 factors compared.

About SunTrust Banks

SunTrust Banks, Inc. is a provider of financial services. The Company’s principal subsidiary is SunTrust Bank (the Bank). The Company’s business segments include Consumer Banking and Private Wealth Management, Wholesale Banking, Mortgage Banking and Corporate Other. As of December 31, 2016, the Consumer Banking and Private Wealth Management segment consisted of three primary businesses: Consumer Banking, Consumer Lending and Private Wealth Management. The Wholesale Banking segment includes the operations of the Corporate and investment banking (CIB), Commercial and Business Banking, Commercial Real Estate, and Treasury and Payment Solutions businesses. The Mortgage Banking segment offers residential mortgage products nationally through its retail and correspondent channels, the Internet (www.suntrust.com) and by telephone. The Bank provides clients with a selection of full-, self- and assisted-service channels, including branch, call center, Teller Connect machines, mobile and tablet.

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