Financial Contrast: Origin Bancorp (NASDAQ:OBNK) and Ally Financial (NYSE:ALLY)

Ally Financial (NYSE:ALLY) and Origin Bancorp (NASDAQ:OBNK) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, dividends, analyst recommendations, valuation, profitability, risk and institutional ownership.

Valuation & Earnings

This table compares Ally Financial and Origin Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ally Financial	$8.21 billion	1.42	$1.02 billion	$2.50	15.35
Origin Bancorp	$347.14 million	3.15	$87.71 million	$3.21	11.07

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

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Ally Financial and Origin Bancorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ally Financial	1	8	8	0	2.41
Origin Bancorp	0	0	0	0	0.00

Ally Financial presently has a consensus target price of $40.80, suggesting a potential upside of 6.33%. Given Ally Financial’s stronger consensus rating and higher probable upside, analysts plainly believe Ally Financial is more favorable than Origin Bancorp.

Profitability

This table compares Ally Financial and Origin Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ally Financial	10.84%	8.39%	0.51%
Origin Bancorp	20.47%	10.45%	0.97%

Dividends

Ally Financial pays an annual dividend of $1.20 per share and has a dividend yield of 3.1%. Origin Bancorp pays an annual dividend of $0.60 per share and has a dividend yield of 1.7%. Ally Financial pays out 48.0% of its earnings in the form of a dividend. Origin Bancorp pays out 18.7% 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. Origin Bancorp has raised its dividend for 4 consecutive years.

Volatility and Risk

Ally Financial has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500. Comparatively, Origin Bancorp has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500.

Insider & Institutional Ownership

88.8% of Ally Financial shares are owned by institutional investors. Comparatively, 47.2% of Origin Bancorp shares are owned by institutional investors. 0.7% of Ally Financial shares are owned by company insiders. Comparatively, 6.2% of Origin Bancorp shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Ally Financial beats Origin Bancorp on 9 of the 17 factors compared between the two stocks.

About Ally Financial

Ally Financial Inc., a digital financial-services company, provides various digital financial products and services in the United States, Canada, and Bermuda. The company operates through Automotive Finance Operations, Insurance Operations, Mortgage Finance Operations, and Corporate Finance Operations segments. The Automotive Finance Operations segment offers automotive financing services, including providing retail installment sales contracts, loans and operating leases, term loans to dealers, financing dealer floorplans and other lines of credit to dealers, warehouse lines to automotive retailers, and fleet financing. It also provides financing services to companies and municipalities for the purchase or lease of vehicles, and vehicle-remarketing services. The Insurance Operations segment offers consumer finance protection and insurance products through the automotive dealer channel, and commercial insurance products directly to dealers. This segment provides vehicle service and maintenance contract, and guaranteed asset protection products; and underwrites commercial insurance coverages, which primarily insure dealers’ vehicle inventory. The Mortgage Finance Operations segment manages consumer mortgage loan portfolio that includes bulk purchases of jumbo and low-to-moderate income mortgage loans originated by third parties, as well as direct-to-consumer mortgage offerings. The Corporate Finance Operations segment provides senior secured leveraged cash flow and asset-based loans to middle market companies; leveraged loans; and commercial real estate product to serve companies in the nursing facilities, senior housing, and medical office buildings. It also offers commercial banking products and services. In addition, it provides securities brokerage and investment advisory services. The company was formerly known as GMAC Inc. and changed its name to Ally Financial Inc. in May 2010. Ally Financial Inc. was founded in 1919 and is based in Detroit, Michigan.

About Origin Bancorp

Origin Bancorp, Inc. is a bank holding company, which engages in the provision of financial services to small and medium-sized businesses, municipalities, high net worth individuals, and retail clients. The firm’s products and services include lending, deposits, mortgage banking, and insurance. It also offers other banking services such as Internet banking and voice response information, mobile applications, cash management, overdraft protection, direct deposit, safe deposit boxes, U.S. savings bonds, and automatic account transfers. The company was founded in 1991 and is headquartered in Ruston, LA.