Critical Review: Swedbank (OTCMKTS:SWDBY) vs. National Bank (NYSE:NBHC)

Swedbank (OTCMKTS:SWDBY) and National Bank (NYSE:NBHC) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, valuation, earnings, institutional ownership, analyst recommendations, risk and dividends.

Risk & Volatility

Swedbank has a beta of 0.69, meaning that its stock price is 31% less volatile than the S&P 500. Comparatively, National Bank has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Swedbank and National Bank, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Swedbank	2	2	2	0	2.00
National Bank	0	3	2	0	2.40

National Bank has a consensus target price of $42.33, indicating a potential upside of 14.33%. Given National Bank’s stronger consensus rating and higher probable upside, analysts plainly believe National Bank is more favorable than Swedbank.

Insider & Institutional Ownership

92.7% of National Bank shares are owned by institutional investors. 6.8% of National Bank shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Dividends

Swedbank pays an annual dividend of SEK 1.48 per share and has a dividend yield of 3.5%. National Bank pays an annual dividend of $1.28 per share and has a dividend yield of 3.5%. Swedbank pays out 50.7% of its earnings in the form of a dividend. National Bank pays out 101.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. National Bank has raised its dividend for 10 consecutive years. Swedbank is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Swedbank and National Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Swedbank	28.94%	14.76%	0.97%
National Bank	8.02%	5.90%	0.78%

Valuation and Earnings

This table compares Swedbank and National Bank”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Swedbank	$11.08 billion	4.27	$3.35 billion	SEK 2.92	14.42
National Bank	$587.34 million	2.81	$109.57 million	$1.26	29.39

Swedbank has higher revenue and earnings than National Bank. Swedbank is trading at a lower price-to-earnings ratio than National Bank, indicating that it is currently the more affordable of the two stocks.

Summary

Swedbank beats National Bank on 9 of the 16 factors compared between the two stocks.

About Swedbank

Swedbank is a Swedish banking group serving individuals, businesses and financial institutions. Its services include everyday banking and payments, savings and investment products, mortgages and other lending, and corporate banking. The bank has a long history rooted in Sweden’s savings bank movement, which dates to the early 19th century. Today, its main markets are Sweden and the Baltic countries of Estonia, Latvia and Lithuania. Swedbank is headquartered in Stockholm. Jens Henriksson has served as the group’s president and chief executive officer since 2019.

About National Bank

National Bank Holdings Corporation is a bank holding company whose subsidiary, NBH Bank, provides commercial and consumer banking services. It serves individuals, businesses and organizations through regional banking brands, including Community Banks of Colorado, Bank Midwest and Hillcrest Bank. Its offerings include deposit accounts, commercial and consumer loans, mortgage services, treasury management and other banking services. The company’s banking operations serve communities in Colorado, Kansas, Missouri, New Mexico, Texas and Utah.