Analyzing Sumitomo Mitsui Financial Group (NYSE:SMFG) & National Australia Bank (OTCMKTS:NABZY)

National Australia Bank (OTCMKTS:NABZY) and Sumitomo Mitsui Financial Group (NYSE:SMFG) are both large-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, valuation, earnings, profitability and analyst recommendations.

Analyst Recommendations

This is a summary of recent ratings and target prices for National Australia Bank and Sumitomo Mitsui Financial Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
National Australia Bank	2	0	0	0	1.00
Sumitomo Mitsui Financial Group	0	1	0	2	3.33

National Australia Bank presently has a consensus target price of $38.00, suggesting a potential upside of 164.81%. Given National Australia Bank’s higher possible upside, analysts clearly believe National Australia Bank is more favorable than Sumitomo Mitsui Financial Group.

Volatility & Risk

National Australia Bank has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500. Comparatively, Sumitomo Mitsui Financial Group has a beta of 0.37, meaning that its stock price is 63% less volatile than the S&P 500.

Dividends

National Australia Bank pays an annual dividend of $0.51 per share and has a dividend yield of 3.6%. Sumitomo Mitsui Financial Group pays an annual dividend of $0.40 per share and has a dividend yield of 2.5%. Sumitomo Mitsui Financial Group pays out 42.1% of its earnings in the form of a dividend.

Insider and Institutional Ownership

3.9% of Sumitomo Mitsui Financial Group shares are held by institutional investors. 0.1% of Sumitomo Mitsui Financial Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares National Australia Bank and Sumitomo Mitsui Financial Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
National Australia Bank	$36.86 billion	2.39	$4.59 billion	N/A	N/A
Sumitomo Mitsui Financial Group	$66.82 billion	1.56	$3.36 billion	$0.95	17.06

National Australia Bank has higher earnings, but lower revenue than Sumitomo Mitsui Financial Group.

Profitability

This table compares National Australia Bank and Sumitomo Mitsui Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
National Australia Bank	N/A	N/A	N/A
Sumitomo Mitsui Financial Group	11.78%	7.88%	0.40%

Summary

Sumitomo Mitsui Financial Group beats National Australia Bank on 8 of the 14 factors compared between the two stocks.

About National Australia Bank

National Australia Bank Limited provides financial services to individuals and businesses in Australia, New Zealand, and internationally. The company operates through Business and Private Banking; Personal Banking; Corporate and Institutional Banking; New Zealand Banking; and Corporate Functions and Other segments. It accepts transaction accounts, savings accounts, debit cards, and term deposits; and specialized accounts, such as foreign currency, business interest, cash maximiser, farm management, community free saver, statutory trust, and project bank accounts, as well as farm management deposits. In addition, the company provides home loans, personal loans, and business loans; vehicle and equipment finance; and trade and invoice finance, as well as business overdrafts and bank guarantees. Further, it offers insurance products consisting of home and content, landlord, travel, car, caravan and trailer, life, and business insurance products; and pension, self-managed super funds, cash management, and financial planning and advisory services. Additionally, the company provides investment products; credit, debit, and business cards; payments and merchant services; online and internet banking services; small business services; international and foreign exchange solutions; and industry specific banking services. The company was founded in 1834 and is based in Melbourne, Australia.

About Sumitomo Mitsui Financial Group

Sumitomo Mitsui Financial Group, Inc., together with its subsidiaries, provides banking, leasing, securities, credit card, and consumer finance services in Japan, the Americas, Europe, the Middle East, Asia, and Oceania. It operates through Wholesale Business Unit, Retail Business Unit, Global Business Unit, and Global Markets Business Unit segments. The company was incorporated in 2002 and is headquartered in Tokyo, Japan.