Toronto-Dominion Bank (NYSE:TD) and KB Financial Group (NYSE:KB) are both large-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, valuation, earnings and risk.

Institutional and Insider Ownership

47.8% of Toronto-Dominion Bank shares are held by institutional investors. Comparatively, 6.1% of KB Financial Group shares are held by institutional investors. 69.0% of KB Financial Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Toronto-Dominion Bank and KB Financial Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Toronto-Dominion Bank 21.27% 16.78% 0.93%
KB Financial Group 21.67% 9.90% 0.75%

Risk & Volatility

Toronto-Dominion Bank has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500. Comparatively, KB Financial Group has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500.

Earnings & Valuation

This table compares Toronto-Dominion Bank and KB Financial Group’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Toronto-Dominion Bank $41.21 billion 2.42 $8.75 billion $5.03 10.82
KB Financial Group $13.29 billion 1.21 $3.10 billion $7.43 5.44

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

Analyst Recommendations

This is a breakdown of current recommendations for Toronto-Dominion Bank and KB Financial Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Toronto-Dominion Bank 0 2 4 0 2.67
KB Financial Group 0 1 1 0 2.50

Toronto-Dominion Bank presently has a consensus target price of $87.00, indicating a potential upside of 59.87%. KB Financial Group has a consensus target price of $61.00, indicating a potential upside of 50.84%. Given Toronto-Dominion Bank’s stronger consensus rating and higher probable upside, research analysts plainly believe Toronto-Dominion Bank is more favorable than KB Financial Group.

Dividends

Toronto-Dominion Bank pays an annual dividend of $1.97 per share and has a dividend yield of 3.6%. KB Financial Group pays an annual dividend of $1.47 per share and has a dividend yield of 3.6%. Toronto-Dominion Bank pays out 39.2% of its earnings in the form of a dividend. KB Financial Group pays out 19.8% 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. Toronto-Dominion Bank has increased its dividend for 2 consecutive years and KB Financial Group has increased its dividend for 3 consecutive years. KB Financial Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Toronto-Dominion Bank beats KB Financial Group on 10 of the 17 factors compared between the two stocks.

About Toronto-Dominion Bank

The Toronto-Dominion Bank, together with its subsidiaries, provides various personal and commercial banking products and services in Canada and the United States. The company operates through three segments: Canadian Retail, U.S. Retail, and Wholesale Banking. It offers personal deposits, such as checking, savings, and investment products; financing, investment, cash management, international trade, and day-to-day banking services to businesses; financing options to customers at point of sale for automotive and recreational vehicle purchases through auto dealer network; credit cards; investing, advice-based, and asset management services to retail and institutional clients; and property and casualty insurance, as well as life and health insurance products. The company also provides capital markets, and corporate and investment banking services, including underwriting and distribution of new debt and equity issues; providing advice on strategic acquisitions and divestitures; and trading, funding, and investment services to companies, governments, and institutions, as well as automated teller machines, telephone, Internet, and mobile banking services. The company offers its products and services under the TD Bank, America's Most Convenient Bank, and TD Securities brand names. It offers personal and business banking products and services through a network of 1,098 branches and 3,394 automated teller machines in Canada; and through a network of 1,257 stores. The Toronto-Dominion Bank was founded in 1855 and is headquartered in Toronto, Canada.

About KB Financial Group

KB Financial Group Inc., a financial holding company, provides a range of banking and related financial services to consumers and corporations in South Korea and internationally. It operates through Corporate Banking, Retail Banking, Other Banking Services, Securities Business, Non-life Insurance Business, Credit Card Business, and Life Insurance Business segments. The company offers deposit and credit products and services, and other related financial services to large, small, medium-sized enterprises and SOHOs, and individuals and households; and engages in trading in securities and derivatives, funding, and other supporting activities. It also provides investment banking, brokerage, and other supporting services; property and life insurance; and credit sale, cash service, and card loan services. In addition, the company offers foreign exchange transaction; financial investment; credit card and installment finance; security investment trust management and advisory; financial leasing; real estate trust management; capital investment; collection of receivables or credit investigation; software advisory, development, and supply; investment advisory and securities dealing; claim; management; asset-backed securitization; investment trust; trust asset management; and real estate services. KB Financial Group Inc. was founded in 2008 and is headquartered in Seoul, South Korea.

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