Critical Analysis: Richmond Mutual Bancorporation (NASDAQ:RMBI) & Commerce Bancshares (NASDAQ:CBSH)

Commerce Bancshares (NASDAQ:CBSH) and Richmond Mutual Bancorporation (NASDAQ:RMBI) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.

Analyst Recommendations

This is a breakdown of recent recommendations for Commerce Bancshares and Richmond Mutual Bancorporation, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Commerce Bancshares	0	6	0	0	2.00
Richmond Mutual Bancorporation	0	0	0	0	0.00

Commerce Bancshares currently has a consensus target price of $67.83, suggesting a potential upside of 1.55%. Given Commerce Bancshares’ stronger consensus rating and higher possible upside, equities analysts clearly believe Commerce Bancshares is more favorable than Richmond Mutual Bancorporation.

Dividends

Commerce Bancshares pays an annual dividend of $1.08 per share and has a dividend yield of 1.6%. Richmond Mutual Bancorporation pays an annual dividend of $0.56 per share and has a dividend yield of 3.9%. Commerce Bancshares pays out 26.9% of its earnings in the form of a dividend. Richmond Mutual Bancorporation pays out 61.5% 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 Commerce Bancshares and Richmond Mutual Bancorporation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Commerce Bancshares	25.24%	16.31%	1.69%
Richmond Mutual Bancorporation	10.99%	6.97%	0.63%

Earnings and Valuation

This table compares Commerce Bancshares and Richmond Mutual Bancorporation”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Commerce Bancshares	$2.09 billion	4.11	$526.33 million	$4.01	16.66
Richmond Mutual Bancorporation	$85.28 million	1.84	$9.38 million	$0.91	15.85

Commerce Bancshares has higher revenue and earnings than Richmond Mutual Bancorporation. Richmond Mutual Bancorporation is trading at a lower price-to-earnings ratio than Commerce Bancshares, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

70.3% of Commerce Bancshares shares are owned by institutional investors. Comparatively, 26.5% of Richmond Mutual Bancorporation shares are owned by institutional investors. 3.2% of Commerce Bancshares shares are owned by insiders. Comparatively, 8.2% of Richmond Mutual Bancorporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

Commerce Bancshares has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Richmond Mutual Bancorporation has a beta of 0.64, meaning that its stock price is 36% less volatile than the S&P 500.

Summary

Commerce Bancshares beats Richmond Mutual Bancorporation on 13 of the 15 factors compared between the two stocks.

About Commerce Bancshares

Commerce Bancshares, Inc. operates as the bank holding company for Commerce Bank that provides retail, mortgage banking, corporate, investment, trust, and asset management products and services to individuals and businesses in the United States. It operates through three segments: Consumer, Commercial, and Wealth. The Consumer segment offers various banking products and services, including consumer deposits; consumer loans, such as automobile, motorcycle, marine, tractor/trailer, recreational vehicle, fixed rate and revolving home equity, and other consumer loans; patient health care financing; real estate loans; indirect and other consumer financing; retail branch network; personal mortgage banking; consumer installment lending; and consumer debit and credit bank cards. The Commercial segment provides corporate lending, leasing, international, merchant and commercial bank card, and securities safekeeping and bond accounting services; and business products, government deposits, and related commercial cash management services, as well as sells fixed income securities to correspondent banks, corporations, public institutions, municipalities, and individuals. The Wealth segment provides traditional trust and estate planning, advisory and discretionary investment portfolio management, and brokerage services, as well as private banking accounts. The company also offers private equity investment, securities brokerage, insurance agency, specialty lending, and leasing services, as well as online and mobile banking services. Commerce Bancshares, Inc. was founded in 1865 and is headquartered in Kansas City, Missouri.

About Richmond Mutual Bancorporation

Richmond Mutual Bancorporation, Inc. operates as the bank holding company for First Bank Richmond that provides various banking services. It accepts various deposits, including savings deposit accounts, money market accounts, NOW and demand accounts, and certificates of deposit. The company also offers a range of lending products, such as multi-family and commercial real estate loans, commercial and industrial loans, construction and development loans, residential real estate loans, and consumer loans. In addition, it engages in the lease financing business; and provision of fee-based financial services comprising trust and estate administration, investment management, retirement plan administration, and private banking services. The company was founded in 1887 and is headquartered in Richmond, Indiana.