Analyzing Nordea Bank Abp (OTCMKTS:NRDBY) and Banco de Chile (NYSE:BCH)

Nordea Bank Abp (OTCMKTS:NRDBYGet Rating) and Banco de Chile (NYSE:BCHGet Rating) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Earnings and Valuation

This table compares Nordea Bank Abp and Banco de Chile’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nordea Bank Abp $11.62 billion 3.35 $4.30 billion $0.94 11.21
Banco de Chile $3.33 billion 2.78 $1.24 billion $3.67 5.01

Nordea Bank Abp has higher revenue and earnings than Banco de Chile. Banco de Chile is trading at a lower price-to-earnings ratio than Nordea Bank Abp, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Nordea Bank Abp and Banco de Chile’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nordea Bank Abp 32.08% 12.23% 0.64%
Banco de Chile 52.75% 35.03% 3.02%

Volatility & Risk

Nordea Bank Abp has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500. Comparatively, Banco de Chile has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Nordea Bank Abp and Banco de Chile, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nordea Bank Abp 0 5 5 0 2.50
Banco de Chile 0 5 2 0 2.29

Nordea Bank Abp currently has a consensus target price of $10.58, suggesting a potential upside of 0.33%. Banco de Chile has a consensus target price of $23.00, suggesting a potential upside of 25.20%. Given Banco de Chile’s higher probable upside, analysts plainly believe Banco de Chile is more favorable than Nordea Bank Abp.

Dividends

Nordea Bank Abp pays an annual dividend of $0.47 per share and has a dividend yield of 4.5%. Banco de Chile pays an annual dividend of $1.03 per share and has a dividend yield of 5.6%. Nordea Bank Abp pays out 50.0% of its earnings in the form of a dividend. Banco de Chile pays out 28.1% 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. Banco de Chile has raised its dividend for 1 consecutive years. Banco de Chile is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

1.1% of Banco de Chile shares are held by institutional investors. 5.9% of Banco de Chile shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Banco de Chile beats Nordea Bank Abp on 10 of the 17 factors compared between the two stocks.

About Nordea Bank Abp

(Get Rating)

Nordea Bank Abp offers banking products and services in Sweden, Finland, Norway, Denmark, and internationally. It operates through Personal Banking, Business Banking, Large Corporates and Institutions, and Asset and Wealth Management segments. The Personal Banking segment provides various financial services to household customers through internet and mobile banking, over the phone, online meetings, and branch offices. The Business Banking segment offers payments, cash management, cards, working capital management, and finance solutions to corporate and personal customers. The Large Corporates and Institutions segment provides financing, cash management and payment, investment banking, and securities services, as well as capital market products to corporate and institutional customers. The Asset and Wealth Management segment offers investment, savings, and risk management solutions to high net worth individuals and institutional investors. This segment also offers life and pensions products and services. The company was founded in 1820 and is headquartered in Helsinki, Finland.

About Banco de Chile

(Get Rating)

Banco de Chile, together with its subsidiaries, provides banking and financial products and services to customers in Chile. It operates through Retail Banking, Wholesale Banking, and Treasury and Money Market segments. The company offers deposit products, such as checking accounts, current accounts, demand deposits and accounts, saving accounts, and time deposits; commercial, mortgage, consumer, working capital, syndicated, and installment loans; and credit cards. It also provides leasing, factoring, and foreign trade services; international and treasury banking services; and financial advisory services. In addition, the company offers liquidity management services, debt instruments, and derivative contracts and leases, as well as financial transaction and currency trading services; and securities brokerage, mutual funds management, wholesale customer, investment banking and management, and insurance brokerage services. As of December 31, 2021, it operated through a network of 272 branches and 1,761 ATMs. The company serves individuals, small and medium-sized companies, corporate clients, and large companies. Banco de Chile was founded in 1893 and is headquartered in Santiago, Chile.

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