HDB vs. RY, MUFG, TD, IBN, SMFG, SAN, BBVA, BMO, ING, and CM
Should you be buying HDFC Bank stock or one of its competitors? The main competitors of HDFC Bank include Royal Bank of Canada (RY), Mitsubishi UFJ Financial Group (MUFG), Toronto-Dominion Bank (TD), ICICI Bank (IBN), Sumitomo Mitsui Financial Group (SMFG), Banco Santander (SAN), Banco Bilbao Vizcaya Argentaria (BBVA), Bank of Montreal (BMO), ING Groep (ING), and Canadian Imperial Bank of Commerce (CM). These companies are all part of the "commercial banks, not elsewhere classified" industry.
Royal Bank of Canada (NYSE:RY) and HDFC Bank (NYSE:HDB) are both large-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, community ranking, media sentiment, earnings, dividends and risk.
Royal Bank of Canada currently has a consensus price target of $137.67, suggesting a potential upside of 25.99%. Given HDFC Bank's higher possible upside, equities research analysts clearly believe Royal Bank of Canada is more favorable than HDFC Bank.
Royal Bank of Canada received 278 more outperform votes than HDFC Bank when rated by MarketBeat users. However, 69.13% of users gave HDFC Bank an outperform vote while only 55.79% of users gave Royal Bank of Canada an outperform vote.
Royal Bank of Canada has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500. Comparatively, HDFC Bank has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500.
Royal Bank of Canada pays an annual dividend of $4.08 per share and has a dividend yield of 3.7%. HDFC Bank pays an annual dividend of $0.60 per share and has a dividend yield of 1.0%. Royal Bank of Canada pays out 50.6% of its earnings in the form of a dividend. HDFC Bank pays out 18.4% 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. Royal Bank of Canada has increased its dividend for 14 consecutive years and HDFC Bank has increased its dividend for 2 consecutive years. Royal Bank of Canada is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
HDFC Bank has a net margin of 15.71% compared to HDFC Bank's net margin of 12.12%. Royal Bank of Canada's return on equity of 15.45% beat HDFC Bank's return on equity.
In the previous week, Royal Bank of Canada had 7 more articles in the media than HDFC Bank. MarketBeat recorded 18 mentions for Royal Bank of Canada and 11 mentions for HDFC Bank. HDFC Bank's average media sentiment score of 1.25 beat Royal Bank of Canada's score of 0.70 indicating that Royal Bank of Canada is being referred to more favorably in the media.
45.3% of Royal Bank of Canada shares are held by institutional investors. Comparatively, 17.6% of HDFC Bank shares are held by institutional investors. 1.0% of HDFC Bank shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Royal Bank of Canada has higher revenue and earnings than HDFC Bank. Royal Bank of Canada is trading at a lower price-to-earnings ratio than HDFC Bank, indicating that it is currently the more affordable of the two stocks.
Summary
Royal Bank of Canada beats HDFC Bank on 11 of the 20 factors compared between the two stocks.
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This chart shows the number of new MarketBeat users adding HDB and its top 5 competitors to their watchlist. Each company is represented with a line over a 90 day period.
This chart shows the average media sentiment of NYSE and its competitors over the past 90 days as caculated by MarketBeat. The averaged score is equivalent to the following: Very Negative Sentiment <= -1.5, Negative Sentiment > -1.5 and <= -0.5, Neutral Sentiment > -0.5 and < 0.5, Positive Sentiment >= 0.5 and < 1.5, and Very Positive Sentiment >= 1.5.
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