Head to Head Analysis: Banco Bradesco (NYSE:BBDO) and Sumitomo Mitsui Financial Group (NYSE:SMFG)

Banco Bradesco (NYSE:BBDO) and Sumitomo Mitsui Financial Group (NYSE:SMFG) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, analyst recommendations, valuation, institutional ownership, dividends and profitability.

Risk and Volatility

Banco Bradesco has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Sumitomo Mitsui Financial Group has a beta of 0.33, suggesting that its stock price is 67% less volatile than the S&P 500.

Valuation and Earnings

This table compares Banco Bradesco and Sumitomo Mitsui Financial Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Bradesco	$41.79 billion	N/A	$4.24 billion	$0.39	8.73
Sumitomo Mitsui Financial Group	$66.82 billion	1.96	$3.36 billion	$1.20	17.13

Banco Bradesco has higher earnings, but lower revenue than Sumitomo Mitsui Financial Group. Banco Bradesco is trading at a lower price-to-earnings ratio than Sumitomo Mitsui Financial Group, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

3.9% of Sumitomo Mitsui Financial Group shares are held by institutional investors. 0.3% of Banco Bradesco shares are held by company insiders. Comparatively, 0.1% of Sumitomo Mitsui Financial Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Banco Bradesco pays an annual dividend of $0.02 per share and has a dividend yield of 0.6%. Sumitomo Mitsui Financial Group pays an annual dividend of $0.48 per share and has a dividend yield of 2.3%. Banco Bradesco pays out 5.1% of its earnings in the form of a dividend. Sumitomo Mitsui Financial Group pays out 40.0% 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 Ratings

This is a breakdown of recent recommendations for Banco Bradesco and Sumitomo Mitsui Financial Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Bradesco	0	0	1	0	3.00
Sumitomo Mitsui Financial Group	1	1	0	1	2.33

Profitability

This table compares Banco Bradesco and Sumitomo Mitsui Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Bradesco	9.85%	13.78%	1.11%
Sumitomo Mitsui Financial Group	13.81%	9.38%	0.48%

Summary

Banco Bradesco beats Sumitomo Mitsui Financial Group on 8 of the 15 factors compared between the two stocks.

About Banco Bradesco

Banco Bradesco S.A., together with its subsidiaries, provides various banking products and services to individuals, corporates, and businesses in Brazil and internationally. The company operates through two segments, Banking and Insurance. It provides current, savings, click, and salary accounts; real estate credit, vehicle financing, payroll loans, mortgage loans, microcredit, leasing, and personal and installment credit; overdraft and agribusiness loans; debit and business cards; financial and security services; consortium products; car, personal accident, dental, travel, and life insurance; investment products; pension products; foreign currency exchange services; capitalization bonds; and internet banking services. Banco Bradesco S.A. was founded in 1943 and is headquartered in Osasco, Brazil.

About Sumitomo Mitsui Financial Group

Sumitomo Mitsui Financial Group, Inc., together with its subsidiaries, provides banking, leasing, securities, credit card, and consumer finance services in Japan, the Americas, Europe, the Middle East, Asia, and Oceania. It operates through Wholesale Business Unit, Retail Business Unit, Global Business Unit, and Global Markets Business Unit segments. The company was incorporated in 2002 and is headquartered in Tokyo, Japan.