Mizuho Financial Group (NYSE:MFG) vs. National Bank of Canada (OTCMKTS:NTIOF) Critical Analysis

Mizuho Financial Group (NYSE:MFG) and National Bank of Canada (OTCMKTS:NTIOF) are both large-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, risk, institutional ownership, dividends, profitability, valuation and analyst recommendations.

Profitability

This table compares Mizuho Financial Group and National Bank of Canada’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mizuho Financial Group	10.16%	8.48%	0.32%
National Bank of Canada	15.34%	16.05%	0.83%

Dividends

Mizuho Financial Group pays an annual dividend of $0.15 per share and has a dividend yield of 2.2%. National Bank of Canada pays an annual dividend of $3.43 per share and has a dividend yield of 3.0%. Mizuho Financial Group pays out 31.3% of its earnings in the form of a dividend. National Bank of Canada pays out 46.8% 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.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Mizuho Financial Group and National Bank of Canada, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mizuho Financial Group	0	1	1	0	2.50
National Bank of Canada	2	4	2	0	2.00

Valuation & Earnings

This table compares Mizuho Financial Group and National Bank of Canada”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mizuho Financial Group	$3,610.35 billion	0.02	$3.92 billion	$0.48	14.06
National Bank of Canada	$8.38 billion	5.27	$2.80 billion	$7.33	15.34

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

Institutional and Insider Ownership

3.3% of Mizuho Financial Group shares are held by institutional investors. Comparatively, 0.1% of National Bank of Canada shares are held by institutional investors. 0.0% of Mizuho Financial Group shares are held by insiders. Comparatively, 0.3% of National Bank of Canada shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk and Volatility

Mizuho Financial Group has a beta of 0.35, indicating that its stock price is 65% less volatile than the S&P 500. Comparatively, National Bank of Canada has a beta of 0.96, indicating that its stock price is 4% less volatile than the S&P 500.

Summary

National Bank of Canada beats Mizuho Financial Group on 10 of the 15 factors compared between the two stocks.

About Mizuho Financial Group

Mizuho Financial Group, Inc., together with its subsidiaries, engages in banking, trust, securities, and other businesses related to financial services in Japan, the Americas, Europe, Asia/Oceania, and internationally. It operates through Retail & Business Banking Company, Corporate & Institutional Company, Global Corporate Company, Global Markets Company, Asset Management Company, and Others segments. The company provides deposit products; syndicated, housing, and card loans; business matching services; and advisory services related to overseas expansions, and mergers and acquisitions-related services. It also offers consulting services, including asset management and asset succession; payroll services; and sells lottery tickets issued by prefectures and ordinance-designated cities. In addition, it offers fund management, underwriting of equity and bonds, risk hedging products, etc. for corporate customers; solutions based on capital management, business strategy, and financial strategy; real estate services; advisory services and solutions, such as advice on proposals on various investment products to financial institutions; and financial services that include funding support and public bonds underwriting. Further, the company offers corporate finance and transaction banking srvices; sales and trading services; investment products; pension funds; and ALM and investment services, including stable capital raising and balance sheet management, as well as management of fixed income, equity, and other securities portfolios. Additionally, the company provides online banking, cash management solutions, currency transaction, trade finance, custody, yen correspondence settlement, and research and consulting services; trust, securitization and structured finance, and stock transfers; and private banking and information technology-related services. Mizuho Financial Group, Inc. was founded in 2000 and is headquartered in Tokyo, Japan.

About National Bank of Canada

National Bank of Canada provides financial services to individuals, businesses, institutional clients, and governments in Canada and internationally. It operates through four segments: Personal and Commercial, Wealth Management, Financial Markets, and U.S. Specialty Finance and International. The Personal and Commercial segment offers personal banking services, including transaction solutions, mortgage loans and home equity lines of credit, consumer loans, payment solutions, and savings and investment solutions; various insurance products; and commercial banking services, such as credit, and deposit, investment solutions, international trade, foreign exchange transactions, payroll, cash management, insurance, electronic transactions, and complimentary services. The Wealth Management segment provides full-service brokerage, private banking, direct brokerage, investment solutions, administrative and trade execution, transaction products, and trust and estate services. The Financial Markets segment offers corporate banking, advisory, and capital markets services; and project financing, debt, and equity underwriting; advisory services in the areas of mergers and acquisitions, and financing. The U.S. Specialty Finance and International segment provides specialty finance products; and personal and commercial banking in Cambodia. National Bank of Canada was founded in 1859 and is headquartered in Montreal, Canada.