Financial Contrast: National Bank of Canada (OTCMKTS:NTIOF) and United Bankshares (NASDAQ:UBSI)

United Bankshares (NASDAQ:UBSI) and National Bank of Canada (OTCMKTS:NTIOF) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, dividends, institutional ownership, earnings, valuation, profitability and analyst recommendations.

Valuation and Earnings

This table compares United Bankshares and National Bank of Canada”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Bankshares	$1.82 billion	3.39	$464.60 million	$3.67	12.33
National Bank of Canada	$21.96 billion	2.38	$2.87 billion	$8.63	15.87

National Bank of Canada has higher revenue and earnings than United Bankshares. United Bankshares 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.

Institutional & Insider Ownership

70.8% of United Bankshares shares are held by institutional investors. Comparatively, 0.1% of National Bank of Canada shares are held by institutional investors. 3.2% of United Bankshares shares are held by company insiders. Comparatively, 0.3% of National Bank of Canada shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent recommendations and price targets for United Bankshares and National Bank of Canada, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Bankshares	0	4	3	0	2.43
National Bank of Canada	0	5	3	0	2.38

United Bankshares currently has a consensus target price of $47.80, indicating a potential upside of 5.61%. Given United Bankshares’ stronger consensus rating and higher probable upside, equities research analysts clearly believe United Bankshares is more favorable than National Bank of Canada.

Dividends

United Bankshares pays an annual dividend of $1.52 per share and has a dividend yield of 3.4%. National Bank of Canada pays an annual dividend of $3.81 per share and has a dividend yield of 2.8%. United Bankshares pays out 41.4% of its earnings in the form of a dividend. National Bank of Canada pays out 44.1% 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. United Bankshares has raised its dividend for 26 consecutive years. United Bankshares is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

United Bankshares has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500. Comparatively, National Bank of Canada has a beta of 0.87, meaning that its share price is 13% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
United Bankshares	27.97%	9.39%	1.53%
National Bank of Canada	17.22%	16.67%	0.85%

Summary

United Bankshares beats National Bank of Canada on 10 of the 16 factors compared between the two stocks.

About United Bankshares

United Bankshares, Inc., through its subsidiaries, primarily provides commercial and retail banking products and services in the United States. It operates through two segments, Community Banking and Mortgage Banking. The company accepts checking, savings, and time and money market accounts; individual retirement accounts; and demand deposits, statement and special savings, and NOW accounts. Its loan products include commercial loans and leases to small to mid-size industrial and commercial companies; construction and real estate loans, such as commercial and residential mortgages, and loans secured by owner-occupied real estate; personal, student, credit card receivables, personal, commercial, and floor plan loans; and home equity loans. In addition, the company provides credit cards; safe deposit boxes, wire transfers, and other banking products and services; investment and security services; services to correspondent banks, including buying and selling federal funds; automated teller machine services; and internet and telephone banking services. Further, it offers community banking services, such as asset management, real property title insurance, financial planning, mortgage banking, and brokerage services, as well as investment management and retirement planning services. United Bankshares, Inc. was incorporated in 1982 and is headquartered in Charleston, West Virginia.

About National Bank of Canada

National Bank of Canada provides financial services to individuals, businesses, institutional clients, and governments in Canada and internationally. It operates through four segments: Personal and Commercial, Wealth Management, Financial Markets, and U.S. Specialty Finance and International. The Personal and Commercial segment offers personal banking services, including transaction solutions, mortgage loans and home equity lines of credit, consumer loans, payment solutions, and savings and investment solutions; various insurance products; and commercial banking services, such as credit, and deposit, investment solutions, international trade, foreign exchange transactions, payroll, cash management, insurance, electronic transactions, and complimentary services. The Wealth Management segment provides full-service brokerage, private banking, direct brokerage, investment solutions, administrative and trade execution, transaction products, and trust and estate services. The Financial Markets segment offers corporate banking, advisory, and capital markets services; and project financing, debt, and equity underwriting; advisory services in the areas of mergers and acquisitions, and financing. The U.S. Specialty Finance and International segment provides specialty finance products; and personal and commercial banking in Cambodia. National Bank of Canada was founded in 1859 and is headquartered in Montreal, Canada.