Critical Review: Toronto Dominion Bank (NYSE:TD) versus Bank of East Asia (OTCMKTS:BKEAY)

Toronto Dominion Bank (NYSE:TD) and Bank of East Asia (OTCMKTS:BKEAY) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, risk, valuation and earnings.

Valuation and Earnings

This table compares Toronto Dominion Bank and Bank of East Asia”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Toronto Dominion Bank	$61.28 billion	2.65	$14.66 billion	$8.43	11.50
Bank of East Asia	$4.96 billion	1.06	$590.75 million	N/A	N/A

Toronto Dominion Bank has higher revenue and earnings than Bank of East Asia.

Profitability

This table compares Toronto Dominion Bank and Bank of East Asia’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Toronto Dominion Bank	16.52%	13.90%	0.76%
Bank of East Asia	N/A	N/A	N/A

Risk and Volatility

Toronto Dominion Bank has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500. Comparatively, Bank of East Asia has a beta of 0.09, indicating that its stock price is 91% less volatile than the S&P 500.

Institutional and Insider Ownership

52.4% of Toronto Dominion Bank shares are held by institutional investors. 0.1% of Toronto Dominion Bank shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Toronto Dominion Bank pays an annual dividend of $3.14 per share and has a dividend yield of 3.2%. Bank of East Asia pays an annual dividend of $0.08 per share and has a dividend yield of 4.0%. Toronto Dominion Bank pays out 37.2% of its earnings in the form of a dividend. Toronto Dominion Bank has increased its dividend for 12 consecutive years.

Analyst Ratings

This is a breakdown of current ratings and target prices for Toronto Dominion Bank and Bank of East Asia, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Toronto Dominion Bank	0	4	3	2	2.78
Bank of East Asia	1	1	0	0	1.50

Toronto Dominion Bank presently has a consensus price target of $93.00, indicating a potential downside of 4.11%. Given Toronto Dominion Bank’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Toronto Dominion Bank is more favorable than Bank of East Asia.

Summary

Toronto Dominion Bank beats Bank of East Asia on 14 of the 16 factors compared between the two stocks.

About Toronto Dominion Bank

The Toronto-Dominion Bank, together with its subsidiaries, provides various financial products and services in Canada, the United States, and internationally. It operates through four segments: Canadian Personal and Commercial Banking, U.S. Retail, Wealth Management and Insurance, and Wholesale Banking. The company offers personal deposits, such as chequing, savings, and investment products; financing, investment, cash management, international trade, and day-to-day banking services to businesses; and financing options to customers at point of sale for automotive and recreational vehicle purchases. It also provides credit cards and payments; real estate secured lending, auto finance, and consumer lending services; point-of-sale payment solutions for large and small businesses; wealth and asset management products, and advice to retail and institutional clients through direct investing, advice-based, and asset management businesses; and property and casualty insurance, as well as life and health insurance products. The company also provides capital markets, and corporate and investment banking products and services, including underwriting and distribution of new debt and equity issues; advice on strategic acquisitions and divestitures; and trading, funding, and investment services to corporations, governments, and institutions. It offers its products and services under the TD Bank and America's Most Convenient Bank brand names. The Toronto-Dominion Bank was founded in 1855 and is headquartered in Toronto, Canada.

About Bank of East Asia

The Bank of East Asia, Limited, together with its subsidiaries, provides various banking and related financial services. Its personal banking services include corporate, individual, savings, current, time deposit, and supreme accounts; and time deposits, foreign currency deposits, MAS services, and auto-payroll products, as well as safe deposit boxes and remittance services. The company also provides corporate banking services, such as SME loans and financing guarantee schemes; corporate and commercial financing products, including syndicated and construction loans, acquisition and structured financing, working capital financing, share financing and IPO-related loans, and commercial mortgages; trade finance services and expert trade solutions; factoring services; import and export trade finance; guarantee services; eTradeConnect that allows buyers and sellers to connect, transact, share information, and submit applications for financing through a single platform; cash management services; corporate wealth management products; foreign exchange and treasury products; and marine cargo, property, trade credit, employee compensation, life, savings, and endowment insurance plans. In addition, it offers private banking services comprising investment advisory services; investment solutions, such as unit trusts, linked deposits, currency trading and management, global equities and bonds investments, structured products, and options and derivatives; portfolio management services; securities and futures broking services; cyber banking, credit cards, and ATM; and various international services. The company operates outlets in Hong Kong, rest of Greater China, Singapore, Malaysia, the United Kingdom, and the United States. The Bank of East Asia, Limited was incorporated in 1918 and is headquartered in Central, Hong Kong.