Reviewing Comerica (NYSE:CMA) and Bank of New York Mellon (NYSE:BK)

Comerica (NYSE:CMA) and Bank of New York Mellon (NYSE:BK) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, earnings, institutional ownership and dividends.

Valuation and Earnings

This table compares Comerica and Bank of New York Mellon”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Comerica	$4.99 billion	1.51	$698.00 million	$5.29	10.85
Bank of New York Mellon	$39.91 billion	1.61	$4.53 billion	$6.14	14.58

Bank of New York Mellon has higher revenue and earnings than Comerica. Comerica is trading at a lower price-to-earnings ratio than Bank of New York Mellon, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Comerica has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500. Comparatively, Bank of New York Mellon has a beta of 1.08, suggesting that its stock price is 8% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Comerica and Bank of New York Mellon, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Comerica	6	8	6	0	2.00
Bank of New York Mellon	0	6	8	0	2.57

Comerica currently has a consensus price target of $61.95, suggesting a potential upside of 7.94%. Bank of New York Mellon has a consensus price target of $91.85, suggesting a potential upside of 2.56%. Given Comerica’s higher possible upside, analysts plainly believe Comerica is more favorable than Bank of New York Mellon.

Institutional & Insider Ownership

80.7% of Comerica shares are owned by institutional investors. Comparatively, 85.3% of Bank of New York Mellon shares are owned by institutional investors. 1.1% of Comerica shares are owned by insiders. Comparatively, 0.1% of Bank of New York Mellon shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Comerica and Bank of New York Mellon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Comerica	14.89%	11.59%	0.94%
Bank of New York Mellon	11.78%	12.96%	1.14%

Dividends

Comerica pays an annual dividend of $2.84 per share and has a dividend yield of 4.9%. Bank of New York Mellon pays an annual dividend of $1.88 per share and has a dividend yield of 2.1%. Comerica pays out 53.7% of its earnings in the form of a dividend. Bank of New York Mellon pays out 30.6% 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. Bank of New York Mellon has increased its dividend for 14 consecutive years.

Summary

Bank of New York Mellon beats Comerica on 13 of the 17 factors compared between the two stocks.

About Comerica

Comerica Incorporated, through its subsidiaries, provides various financial products and services. The company operates through Commercial Bank, Retail Bank, Wealth Management, and Finance segments. The Commercial Bank segment offers various products and services, including commercial loans and lines of credit, deposits, cash management, payment solutions, card services, capital market products, international trade finance, letters of credit, foreign exchange management services, and loan syndication services for small and middle market businesses, multinational corporations, and governmental entities. The Retail Bank segment provides personal financial services, such as consumer lending, consumer deposit gathering, and mortgage loan origination; and various consumer products that include deposit accounts, installment loans, credit cards, student loans, home equity lines of credit, and residential mortgage loans. The Wealth Management segment offers products and services comprising financial planning, trust and fiduciary services, investment management and advisory, brokerage, private banking, and business transition planning services for affluents, high-net worth and ultra-high-net-worth individuals and families, business owners, and executives, and institutional clients. The Finance segment comprises securities portfolio, and asset and liability management activities. It operates in Texas, California, Michigan, Arizona, and Florida, the United States; and Canada and Mexico. The company was formerly known as DETROITBANK Corporation and changed its name to Comerica Incorporated in July 1982. Comerica Incorporated was founded in 1849 and is headquartered in Dallas, Texas.

About Bank of New York Mellon

The Bank of New York Mellon Corporation provides a range of financial products and services in the United States and internationally. The company operates through Securities Services, Market and Wealth Services, Investment and Wealth Management, and other segments. The Securities Services segment offers custody, trust and depositary, accounting, exchange-traded funds, middle-office solutions, transfer agency, services for private equity and real estate funds, foreign exchange, securities lending, liquidity/lending services, and data analytics. This segment also provides trustee, paying agency, fiduciary, escrow and other financial, issuer, and support services for brokers and investors. The Market and Wealth Services segment offers clearing and custody, investment, wealth and retirement solutions, technology and enterprise data management, trading, and prime brokerage services. This segment also provides integrated cash management solutions, including payments, foreign exchange, liquidity management, receivables processing and payables management, and trade finance and processing services. The Investment and Wealth Management segment offers investment management strategies and distribution of investment products, investment management, custody, wealth and estate planning, private banking, investment, and information management services. The Other segment engages in the provision of leasing, corporate treasury, derivative and other trading, corporate and bank-owned life insurance, renewable energy investment, and business exit services. It serves central banks and sovereigns, financial institutions, asset managers, insurance companies, corporations, local authorities and high net-worth individuals, and family offices. The Bank of New York Mellon Corporation was founded in 1784 and is headquartered in New York, New York.