Head-To-Head Survey: Swedbank (SWDBY) versus National Bank of Canada (NTIOF)

Swedbank (OTCMKTS:SWDBY) and National Bank of Canada (OTCMKTS:NTIOF) are both large-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, valuation, analyst recommendations, risk, earnings, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Swedbank and National Bank of Canada, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Swedbank 0 3 0 0 2.00
National Bank of Canada 0 4 1 0 2.20

Valuation & Earnings

This table compares Swedbank and National Bank of Canada’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Swedbank $6.23 billion 2.67 $2.34 billion $2.14 6.97
National Bank of Canada $8.33 billion 1.88 $1.67 billion $4.66 10.03

Swedbank has higher earnings, but lower revenue than National Bank of Canada. Swedbank is trading at a lower price-to-earnings ratio than National Bank of Canada, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Swedbank has a beta of 0.59, indicating that its share price is 41% less volatile than the S&P 500. Comparatively, National Bank of Canada has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500.

Dividends

Swedbank pays an annual dividend of $1.27 per share and has a dividend yield of 8.5%. National Bank of Canada pays an annual dividend of $1.97 per share and has a dividend yield of 4.2%. Swedbank pays out 59.3% of its earnings in the form of a dividend. National Bank of Canada pays out 42.3% 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.

Insider and Institutional Ownership

0.1% of Swedbank shares are held by institutional investors. Comparatively, 0.1% of National Bank of Canada shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Swedbank and National Bank of Canada’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Swedbank 38.87% 16.85% 0.83%
National Bank of Canada 19.45% 18.15% 0.84%

Summary

National Bank of Canada beats Swedbank on 9 of the 14 factors compared between the two stocks.

Swedbank Company Profile

Swedbank AB (publ) provides various banking products and services to private, corporate, and organizational customers. The company operates through Swedish Banking, Baltic Banking, and Large Corporates & Institutions segments. It offers deposit and lending products; guarantees; non-life insurance products; brokerage and other securities; real estate brokerage; and asset management, financing, and life insurance and pension services. The company also offers investments and trading services, including equity, currency, fixed income, and equity trading services, as well as structured products; advisory and investment banking products and services, such as corporate financing, debt capital market, and loans and syndication services; and transaction banking services, such as cash management, trade finance, securities, commercial payments, account, and clearing and settlement services. In addition, it provides private banking products and services, such as saving accounts, credit and debit cards, mortgage finance, and investment advice, as well as trades in derivatives; and telephone, Internet, and mobile banking services. The company has 186 branches in Sweden, 33 branches in Estonia, 33 in Latvia, and 59 in Lithuania. It also operates in Norway, Finland, Denmark, Luxembourg, China, the United States, and South Africa. The company was formerly known as ForeningsSparbanken AB and changed its name to Swedbank AB (publ) in September 2006. Swedbank AB (publ) was founded in 1820 and is headquartered in Sundbyberg, Sweden.

National Bank of Canada Company Profile

National Bank of Canada provides various financial products and services to retail, commercial, corporate, and institutional clients in Canada and internationally. It operates through Personal and Commercial, Wealth Management, Financial Markets, and U.S. Specialty Finance and International segments. The Personal and Commercial segment offers personal banking services, including transaction solutions, mortgage loans and home equity lines of credit, consumer loans, payment solutions, savings options, and tailored investment solutions; various insurance products; and commercial banking services, such as credit, and deposit and investment solutions, as well as international trade, foreign exchange transactions, payroll, cash management, insurance, electronic transactions, and complementary services. The Wealth Management segment provides investment solutions, trust services, banking services, lending services, and other wealth management solutions through internal and third-party distribution networks. The Financial Markets segment offers risk management products and services; and debt and equity underwriting; advisory services in the areas of mergers and acquisitions, and financing. The U.S. Specialty Finance and International segments provides specialty finance expertise; financial products and services to individuals and businesses in Cambodia; and the activities of targeted investments in certain emerging markets. The company provides its services through a network of 428 branches and 937 banking machines. The company was founded in 1859 and is headquartered in Montreal, Canada.

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