Critical Analysis: Fulton Financial (NASDAQ:FULT) & WSFS Financial (NASDAQ:WSFS)

Fulton Financial (NASDAQ:FULT) and WSFS Financial (NASDAQ:WSFS) are both mid-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their earnings, valuation, risk, institutional ownership, dividends, profitability and analyst recommendations.

Institutional & Insider Ownership

72.0% of Fulton Financial shares are owned by institutional investors. Comparatively, 88.5% of WSFS Financial shares are owned by institutional investors. 1.1% of Fulton Financial shares are owned by insiders. Comparatively, 1.2% of WSFS Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Fulton Financial and WSFS Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fulton Financial	0	4	1	0	2.20
WSFS Financial	0	1	1	0	2.50

Fulton Financial currently has a consensus target price of $18.40, indicating a potential upside of 5.50%. WSFS Financial has a consensus target price of $48.00, indicating a potential downside of 1.86%. Given Fulton Financial’s higher probable upside, equities research analysts clearly believe Fulton Financial is more favorable than WSFS Financial.

Earnings and Valuation

This table compares Fulton Financial and WSFS Financial’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fulton Financial	$1.50 billion	2.11	$284.28 million	$1.61	10.83
WSFS Financial	$1.27 billion	2.32	$269.16 million	$4.48	10.92

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

Profitability

This table compares Fulton Financial and WSFS Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fulton Financial	18.31%	11.73%	1.06%
WSFS Financial	20.73%	11.94%	1.39%

Risk and Volatility

Fulton Financial has a beta of 0.75, meaning that its share price is 25% less volatile than the S&P 500. Comparatively, WSFS Financial has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500.

Dividends

Fulton Financial pays an annual dividend of $0.68 per share and has a dividend yield of 3.9%. WSFS Financial pays an annual dividend of $0.60 per share and has a dividend yield of 1.2%. Fulton Financial pays out 42.2% of its earnings in the form of a dividend. WSFS Financial pays out 13.4% 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.

Summary

WSFS Financial beats Fulton Financial on 11 of the 15 factors compared between the two stocks.

About Fulton Financial

Fulton Financial Corporation operates as a financial holding company that provides consumer and commercial banking products and services in Pennsylvania, Delaware, Maryland, New Jersey, and Virginia. It accepts various checking accounts and savings deposit products, certificates of deposit, and individual retirement accounts. The company offers consumer loans products, including home equity loans and lines of credit, automobile loans, personal lines of credit, and checking account overdraft protection; construction and jumbo residential mortgage loans; and commercial lending products comprising commercial real estate, commercial and industrial, and construction loans, as well as equipment lease financing loans. In addition, it offers letters of credit, cash management services, and traditional deposit products; and wealth management services, including investment management, trust, brokerage, insurance, and investment advisory services. Further, the company owns trust preferred securities; and sells various life insurance products. It provides its products and services through financial center offices, as well as through a network of automated teller machines, telephone banking, mobile banking, and online banking. Fulton Financial Corporation was founded in 1882 and is headquartered in Lancaster, Pennsylvania.

About WSFS Financial

WSFS Financial Corporation operates as the savings and loan holding company for the Wilmington Savings Fund Society, FSB that provides various banking services in the United States. It operates through three segments: WSFS Bank, Cash Connect, and Wealth Management. It offers various deposit products, including savings accounts, demand deposits, interest-bearing demand deposits, money market deposit accounts, and certificates of deposit, as well as accepts jumbo certificates of deposit from individuals, businesses, and municipalities. The company also provides a range of loans, which comprise fixed and adjustable rate residential loans; commercial mortgage and commercial loans; commercial construction loans; commercial loans for working capital, financing equipment and real estate acquisitions, business expansion and other business purposes; and consumer credit products, such as home equity loans, home equity lines of credit, automobile loans, unsecured lines of credit, and other secured and unsecured personal installment loans. In addition, it offers insurance products; planning and advisory services, investment management, trust services, and credit and deposit products to individual, corporate and institutional clients; retail securities and insurance brokerage services; mortgage and title services; residential mortgage and refinancing solutions; and leases small equipment and fixed assets, as well as provides financial planning, customized investment strategies, brokerage products, fiduciary, and wealth management services. Further, the company provides ATM vault cash, smart safe, and other cash logistics services; and online reporting and ATM cash management, predictive cash ordering and reconcilement services, armored carrier management, loss protection, and deposit safe cash logistics services, as well as trustee, agency, bankruptcy administration, custodial and commercial domicile services. The company was founded in 1832 and is based in Wilmington, Delaware.