Head-To-Head Review: Mitsubishi UFJ Financial Group (NYSE:MUFG) & NatWest Group (NYSE:NWG)

NatWest Group (NYSE:NWG) and Mitsubishi UFJ Financial Group (NYSE:MUFG) are both large-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, institutional ownership, risk, profitability, valuation, analyst recommendations and earnings.

Profitability

This table compares NatWest Group and Mitsubishi UFJ Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NatWest Group	19.61%	13.75%	0.80%
Mitsubishi UFJ Financial Group	17.63%	12.30%	0.66%

Dividends

NatWest Group pays an annual dividend of $0.63 per share and has a dividend yield of 4.0%. Mitsubishi UFJ Financial Group pays an annual dividend of $0.51 per share and has a dividend yield of 2.4%. NatWest Group pays out 31.5% of its earnings in the form of a dividend. Mitsubishi UFJ Financial Group pays out 33.3% 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. NatWest Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares NatWest Group and Mitsubishi UFJ Financial Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NatWest Group	$38.91 billion	1.63	$7.69 billion	$2.00	7.97
Mitsubishi UFJ Financial Group	$97.13 billion	2.58	$11.41 billion	$1.53	13.78

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

Risk & Volatility

NatWest Group has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500. Comparatively, Mitsubishi UFJ Financial Group has a beta of 0.51, meaning that its share price is 49% less volatile than the S&P 500.

Institutional and Insider Ownership

1.3% of NatWest Group shares are held by institutional investors. Comparatively, 13.6% of Mitsubishi UFJ Financial Group shares are held by institutional investors. 0.0% of Mitsubishi UFJ Financial Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations for NatWest Group and Mitsubishi UFJ Financial Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NatWest Group	0	3	6	1	2.80
Mitsubishi UFJ Financial Group	0	1	3	1	3.00

Summary

NatWest Group beats Mitsubishi UFJ Financial Group on 8 of the 15 factors compared between the two stocks.

About NatWest Group

NatWest Group plc, together with its subsidiaries, provides banking and financial products and services to personal, commercial, corporate, and institutional customers in the United Kingdom and internationally. It operates through Retail Banking, Private Banking, and Commercial & Institutional segments. The Retail Banking segment offers a range of banking products and related financial services, such as current accounts, mortgages, personal unsecured lending, and personal deposits, as well as mobile and online banking services. The Private Banking segment provides private banking and wealth management products for high-net-worth individuals and their business interests. The Commercial & Institutional segment offers banking and financial solutions to large corporate organisations, multi-nationals, and financial institutions. The company was formerly known as The Royal Bank of Scotland Group plc and changed its name to NatWest Group plc in July 2020. NatWest Group plc was founded in 1727 and is headquartered in Edinburgh, the United Kingdom.

About Mitsubishi UFJ Financial Group

Mitsubishi UFJ Financial Group, Inc. operates as the bank holding company, that engages in a range of financial businesses in Japan, the United States, Europe, Asia/Oceania, and internationally. It operates through seven segments: Digital Service, Retail & Commercial Banking, Japanese Corporate & Investment Banking, Global Commercial Banking, Asset Management & Investor Services, Global Corporate & Investment Banking, and Global Markets. The company offers commercial banking, trust banking, and securities products and services to retail, and small and medium-sized enterprise customers. It also provides mergers and acquisition, debt and equity issuance, financial advice, and real estate-related services; digital-based financial services; credit cards; and trust banking and securities products and services, as well as engages in the lending, fund settlement, and foreign exchange businesses. In addition, the company offers corporate banking services, such as project export credit agency finance, and financing through asset-backed commercial paper; investment and transaction banking services for corporations, financial institutions, sovereign and multinational organizations, and institutional investors; and asset management and investor services, including pension fund management and administration, pension structure advisory, beneficiary payment, and investment trust services for retail customers. Further, it provides loans, deposits, fund transfers, hedging, and investments services for retail, small and medium-sized enterprise, as well as corporate customers; financing for automotive and consumer goods; sells and trades in fixed income instruments, currencies, equities, and equities; offers investment products comprising mutual funds, structured bonds, and notes; originates and distributes of financial products; and provides insurance and treasury services. The company was founded in 1880 and is headquartered in Tokyo, Japan.