Head-To-Head Analysis: Agri Bank China (OTCMKTS:ACGBY) vs. Royal Bank Of Canada (NYSE:RY)

Royal Bank Of Canada (NYSE:RY) and Agri Bank China (OTCMKTS:ACGBY) are both large-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Institutional & Insider Ownership

45.3% of Royal 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.

Risk & Volatility

Royal Bank Of Canada has a beta of 0.86, meaning that its share price is 14% less volatile than the S&P 500. Comparatively, Agri Bank China has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500.

Dividends

Royal Bank Of Canada pays an annual dividend of $4.42 per share and has a dividend yield of 3.0%. Agri Bank China pays an annual dividend of $0.61 per share and has a dividend yield of 3.3%. Royal Bank Of Canada pays out 46.7% of its earnings in the form of a dividend. Agri Bank China pays out 22.6% 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 15 consecutive years. Agri Bank China is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of recent recommendations for Royal Bank Of Canada and Agri Bank China, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Royal Bank Of Canada	0	6	7	0	2.54
Agri Bank China	0	0	0	0	0.00

Royal Bank Of Canada presently has a consensus target price of $177.50, indicating a potential upside of 18.50%. Given Royal Bank Of Canada’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Royal Bank Of Canada is more favorable than Agri Bank China.

Profitability

This table compares Royal Bank Of Canada and Agri Bank China’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Royal Bank Of Canada	14.03%	16.12%	0.89%
Agri Bank China	20.80%	9.22%	0.64%

Earnings and Valuation

This table compares Royal Bank Of Canada and Agri Bank China”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Royal Bank Of Canada	$64.40 billion	3.26	$11.92 billion	$9.47	15.82
Agri Bank China	$195.64 billion	1.32	$39.24 billion	$2.70	6.81

Agri Bank China has higher revenue and earnings than Royal Bank Of Canada. Agri Bank China is trading at a lower price-to-earnings ratio than Royal Bank Of Canada, indicating that it is currently the more affordable of the two stocks.

Summary

Royal Bank Of Canada beats Agri Bank China on 11 of the 16 factors compared between the two stocks.

About Royal Bank Of Canada

Royal Bank of Canada operates as a diversified financial service company worldwide. The company's Personal & Commercial Banking segment offers checking and savings accounts, home equity financing, personal lending, private banking, indirect lending, including auto financing, mutual funds and self-directed brokerage accounts, guaranteed investment certificates, credit cards, and payment products and solutions; and lending, leasing, deposit, investment, foreign exchange, cash management, auto dealer financing, trade products, and services to small and medium-sized commercial businesses. This segment offers financial products and services through branches, automated teller machines, and mobile sales network. Its Wealth Management segment provides a suite of wealth, investment, trust, banking, credit, and other advice-based solutions and strategies to high net worth and ultra-high net worth individuals, and institutional clients; asset management products to institutional and individual clients; and asset and investor services to financial institutions, asset managers, and asset owners. The company's Insurance segment offers life, health, home, auto, travel, wealth, annuities, property and casualty, and reinsurance advice and solutions; and business insurance services to individual, business, and group clients through its advice centers, RBC insurance stores, and mobile advisors; digital platforms; and independent brokers and partners. The company's Capital Markets segment offers advisory and origination, sales and trading, lending and financing, and transaction banking services to corporations, institutional clients, asset managers, private equity firms, and governments. The company was founded in 1864 and is headquartered in Toronto, Canada.

About Agri Bank China

Agricultural Bank of China Limited, together with its subsidiaries, provides banking products and services. The company operates through Corporate Banking, Personal Banking, and Treasury Operations segments. It offers demand, personal call, foreign currency call, time or demand optional, foreign exchange call, foreign exchange time, savings, agreed term, and negotiated deposit accounts, as well as certificates of deposit; and loans, including housing, consumer, business, fixed asset, working capital, real estate, and entrusted syndicated loans, as well as trade finances, guarantees and commitments, and loans with custody of export rebates accounts. The company provides credit card, debit card, payment and settlement, private banking, cash management, investment banking, custody, financial market, and financial institution services, as well as trading and wealth management services; and personal fund collection and automatic transfer services. In addition, it offers agro-related personal and corporate banking products and services; telephone, mobile, self-service, television, and SMS banking services; financial leasing services; fund management services; asset custodian services; and insurance and reinsurance related products and services. The company operates domestic branches, including specialized institutions, training institutes, tier-1 branches, tier-2 branches, tier-1 sub-branches, foundation-level branch outlets and other establishments; overseas branches in Hong Kong, Singapore, Seoul, New York, Dubai International Financial Centre, Tokyo, Frankfurt, Sydney, Luxemburg, Dubai, London, Macao, and Hanoi; and overseas representative offices in Vancouver, Taipei, Sao Paulo, and Dushanbe. The company was founded in 1951 and is based in Beijing, the People's Republic of China.