KBC Group (OTCMKTS:KBCSY – Get Free Report) and Valley National Bancorp (NASDAQ:VLY – Get Free Report) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.
Profitability
This table compares KBC Group and Valley National Bancorp’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| KBC Group | 15.58% | 13.42% | 0.94% |
| Valley National Bancorp | 19.49% | 9.13% | 1.06% |
Earnings & Valuation
This table compares KBC Group and Valley National Bancorp”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| KBC Group | $26.56 billion | 2.15 | $4.04 billion | $5.26 | 13.01 |
| Valley National Bancorp | $3.49 billion | 2.02 | $597.98 million | $1.18 | 10.81 |
KBC Group has higher revenue and earnings than Valley National Bancorp. Valley National Bancorp is trading at a lower price-to-earnings ratio than KBC Group, indicating that it is currently the more affordable of the two stocks.
Dividends
KBC Group pays an annual dividend of $3.19 per share and has a dividend yield of 4.7%. Valley National Bancorp pays an annual dividend of $0.44 per share and has a dividend yield of 3.5%. KBC Group pays out 60.6% of its earnings in the form of a dividend. Valley National Bancorp pays out 37.3% 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.
Analyst Recommendations
This is a summary of current ratings and recommmendations for KBC Group and Valley National Bancorp, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| KBC Group | 1 | 4 | 2 | 0 | 2.14 |
| Valley National Bancorp | 0 | 4 | 9 | 3 | 2.94 |
Valley National Bancorp has a consensus target price of $16.27, suggesting a potential upside of 27.60%. Given Valley National Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Valley National Bancorp is more favorable than KBC Group.
Institutional and Insider Ownership
61.0% of Valley National Bancorp shares are owned by institutional investors. 1.1% of Valley National Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Risk and Volatility
KBC Group has a beta of 0.64, suggesting that its stock price is 36% less volatile than the S&P 500. Comparatively, Valley National Bancorp has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500.
Summary
Valley National Bancorp beats KBC Group on 10 of the 17 factors compared between the two stocks.
About KBC Group
KBC Group NV, together with its subsidiaries, provides integrated bank-insurance services primarily for retail, private banking, small and medium sized enterprises, and mid-cap clients. The company offers demand deposits and savings accounts; home and mortgage loans; consumer finance and SME funding services; credit, investment fund and asset management, and life and non-life insurance; and cash management, payments, trade finance, lease, money market, capital market products, and stockbroking services. It also provides digital and mobile banking services. The company was formerly known as KBC Bank and Insurance Holding Company NV and changed its name to KBC Group NV in March 2005. KBC Group NV was incorporated in 1935 and is headquartered in Brussels, Belgium.
About Valley National Bancorp
Valley National Bancorp operates as the holding company for Valley National Bank that provides various commercial, private banking, retail, insurance, and wealth management financial services products. It operates through Consumer Banking, Commercial Banking, and Treasury and Corporate other segments. The company offers non-interest bearing, savings, NOW, money market, and time deposit accounts; commercial and industrial, commercial real estate, residential mortgage, and automobile loans; loans secured by the cash surrender value of life insurance; home equity loans and lines of credit; automobile financing; and secured and unsecured other consumer loans. It also invests in various securities and interest-bearing deposits with other banks; and provides international banking services, such as standby and documentary letters of credit, and related products, as well as foreign exchange transactions, documentary collections, and foreign wire transfers services. In addition, the company offers investment services for individuals and small to medium sized businesses; and trusts investment strategies designed for various investment profiles and objectives. Further, it provides trust services, such as living and testamentary trusts, investment management, custodial and escrow services, and estate administration to individuals; tax credit advisory services; brokerage services; property and casualty, life, health, and title insurance agency services; and health care equipment lending and other commercial equipment leasing services, as well as owns real estate related investments. Additionally, the company offers online, mobile, and telephone banking services; receivable, payment, and security solution, merchant, payroll processing, and liquidity services; credit cards; and drive-in and night deposit, automated teller machine, remote deposit capture, and safe deposit facility services. Valley National Bancorp was founded in 1927 and is headquartered in Morristown, New Jersey.
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