Analyzing Intercorp Financial Services (IFS) and Its Peers

Intercorp Financial Services (NYSE:IFS) is one of 919 public companies in the “Banks” industry, but how does it contrast to its competitors? We will compare Intercorp Financial Services to similar companies based on the strength of its valuation, risk, institutional ownership, dividends, earnings, profitability and analyst recommendations.

Earnings and Valuation

This table compares Intercorp Financial Services and its competitors top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Intercorp Financial Services	$1.67 billion	$542.25 million	8.56
Intercorp Financial Services Competitors	$9.95 billion	$2.42 billion	20.29

Intercorp Financial Services’ competitors have higher revenue and earnings than Intercorp Financial Services. Intercorp Financial Services is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Intercorp Financial Services and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Intercorp Financial Services	34.81%	17.06%	2.10%
Intercorp Financial Services Competitors	15.66%	9.44%	0.93%

Dividends

Intercorp Financial Services pays an annual dividend of $1.71 per share and has a dividend yield of 3.7%. Intercorp Financial Services pays out 31.3% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 9.3% and pay out 28.9% of their earnings in the form of a dividend. Intercorp Financial Services has increased its dividend for 1 consecutive years. Intercorp Financial Services lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Analyst Recommendations

This is a breakdown of recent ratings for Intercorp Financial Services and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Intercorp Financial Services	0	2	1	0	2.33
Intercorp Financial Services Competitors	7481	30219	27791	1473	2.35

Intercorp Financial Services currently has a consensus price target of $62.00, indicating a potential upside of 32.47%. As a group, “Banks” companies have a potential upside of 17.05%. Given Intercorp Financial Services’ higher possible upside, equities research analysts plainly believe Intercorp Financial Services is more favorable than its competitors.

Volatility and Risk

Intercorp Financial Services has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500. Comparatively, Intercorp Financial Services’ competitors have a beta of 0.61, suggesting that their average stock price is 39% less volatile than the S&P 500.

Insider and Institutional Ownership

48.0% of shares of all “Banks” companies are held by institutional investors. 9.7% of shares of all “Banks” companies are held by company insiders. 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.

Summary

Intercorp Financial Services competitors beat Intercorp Financial Services on 10 of the 15 factors compared.

About Intercorp Financial Services

Intercorp Financial Services Inc., together with its subsidiaries, offers banking, insurance, wealth management, and payment services for retail and commercial clients in Peru. The company provides loans, credit facilities, deposits, and current accounts; life annuity products with single-premium payment and conventional life insurance products, as well as other retail insurance products; and brokerage and investment management services. It engages in the development, management, operation, and processing of credit and debit cards; facilitation of payments and services through commercial stores; and installation and maintenance of infrastructure for transactions through electronic commerce modality and networks of payment methods processors. The company was incorporated in 1897 and is based in Lima, Peru. Intercorp Financial Services Inc. operates as a subsidiary of Intercorp Perú Ltd.