HSBC (NYSE:HSBC) & Mizuho Financial Group (NYSE:MFG) Financial Comparison

Mizuho Financial Group (NYSE:MFG) and HSBC (NYSE:HSBC) are both large-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Volatility and Risk

Mizuho Financial Group has a beta of 0.46, indicating that its stock price is 54% less volatile than the S&P 500. Comparatively, HSBC has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500.

Insider and Institutional Ownership

3.3% of Mizuho Financial Group shares are held by institutional investors. Comparatively, 1.5% of HSBC shares are held by institutional investors. 0.0% of Mizuho Financial Group shares are held by company insiders. Comparatively, 0.0% of HSBC shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Mizuho Financial Group and HSBC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mizuho Financial Group	12.31%	9.23%	0.35%
HSBC	16.06%	13.35%	0.82%

Earnings and Valuation

This table compares Mizuho Financial Group and HSBC”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mizuho Financial Group	$59.30 billion	1.81	$3.92 billion	$0.57	15.24
HSBC	$131.35 billion	2.31	$22.29 billion	$6.10	14.49

HSBC has higher revenue and earnings than Mizuho Financial Group. HSBC is trading at a lower price-to-earnings ratio than Mizuho Financial Group, indicating that it is currently the more affordable of the two stocks.

Dividends

Mizuho Financial Group pays an annual dividend of $0.15 per share and has a dividend yield of 1.7%. HSBC pays an annual dividend of $8.98 per share and has a dividend yield of 10.2%. Mizuho Financial Group pays out 26.3% of its earnings in the form of a dividend. HSBC pays out 147.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Mizuho Financial Group and HSBC, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mizuho Financial Group	0	1	1	0	2.50
HSBC	0	6	5	0	2.45

HSBC has a consensus target price of $63.00, indicating a potential downside of 28.74%. Given HSBC’s higher possible upside, analysts clearly believe HSBC is more favorable than Mizuho Financial Group.

Summary

HSBC beats Mizuho Financial Group on 11 of the 15 factors compared between the two stocks.

About Mizuho Financial Group

Mizuho Financial Group, Inc., together with its subsidiaries, engages in banking, trust, securities, and other businesses related to financial services in Japan, the Americas, Europe, Asia/Oceania, and internationally. It operates through Retail & Business Banking Company, Corporate & Institutional Company, Global Corporate Company, Global Markets Company, Asset Management Company, and Others segments. The company provides deposit products; syndicated, housing, and card loans; business matching services; and advisory services related to overseas expansions, and mergers and acquisitions-related services. It also offers consulting services, including asset management and asset succession; payroll services; and sells lottery tickets issued by prefectures and ordinance-designated cities. In addition, it offers fund management, underwriting of equity and bonds, risk hedging products, etc. for corporate customers; solutions based on capital management, business strategy, and financial strategy; real estate services; advisory services and solutions, such as advice on proposals on various investment products to financial institutions; and financial services that include funding support and public bonds underwriting. Further, the company offers corporate finance and transaction banking srvices; sales and trading services; investment products; pension funds; and ALM and investment services, including stable capital raising and balance sheet management, as well as management of fixed income, equity, and other securities portfolios. Additionally, the company provides online banking, cash management solutions, currency transaction, trade finance, custody, yen correspondence settlement, and research and consulting services; trust, securitization and structured finance, and stock transfers; and private banking and information technology-related services. Mizuho Financial Group, Inc. was founded in 2000 and is headquartered in Tokyo, Japan.

About HSBC

HSBC Holdings plc provides banking and financial services worldwide. The company operates through Wealth and Personal Banking, Commercial Banking, and Global Banking and Markets segments. The Wealth and Personal Banking segment offers retail banking and wealth products, including current and savings accounts, mortgages and personal loans, credit and debit cards, and local and international payment services; and wealth management services comprising insurance and investment products, global asset management services, investment management, and private wealth solutions. This segment serves personal banking and high net worth individuals. The Commercial Banking segment provides credit and lending, treasury management, payment, cash management, commercial insurance, and investment services; commercial cards; international trade and receivables finance services; foreign exchange products; capital raising services on debt and equity markets; and advisory services. It serves small and medium sized enterprises, mid-market enterprises, and corporates. The Global Banking and Markets segment offers financing, advisory, and transaction services; and credit, rates, foreign exchange, equities, money markets, and securities services; and engages in principal investment activities. It serves government, corporate and institutional clients, and private investors. HSBC Holdings plc was founded in 1865 and is headquartered in London, the United Kingdom.