Reviewing Banco Santander Brasil (NYSE:BSBR) & Bank of China (OTCMKTS:BACHY)

Banco Santander Brasil (NYSE:BSBR) and Bank of China (OTCMKTS:BACHY) are both large-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Risk and Volatility

Banco Santander Brasil has a beta of 0.56, suggesting that its share price is 44% less volatile than the S&P 500. Comparatively, Bank of China has a beta of 0.07, suggesting that its share price is 93% less volatile than the S&P 500.

Insider & Institutional Ownership

14.5% of Banco Santander Brasil shares are held by institutional investors. 0.1% of Banco Santander Brasil 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.

Analyst Recommendations

This is a summary of current recommendations and price targets for Banco Santander Brasil and Bank of China, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Santander Brasil	2	1	1	0	1.75
Bank of China	0	1	0	0	2.00

Banco Santander Brasil currently has a consensus target price of $6.50, suggesting a potential upside of 20.48%. Given Banco Santander Brasil’s higher possible upside, equities analysts plainly believe Banco Santander Brasil is more favorable than Bank of China.

Profitability

This table compares Banco Santander Brasil and Bank of China’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Santander Brasil	7.06%	10.49%	1.04%
Bank of China	20.09%	7.81%	0.67%

Dividends

Banco Santander Brasil pays an annual dividend of $0.29 per share and has a dividend yield of 5.4%. Bank of China pays an annual dividend of $0.63 per share and has a dividend yield of 3.9%. Bank of China pays out 24.5% of its earnings in the form of a dividend.

Valuation & Earnings

This table compares Banco Santander Brasil and Bank of China”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Santander Brasil	$42.52 billion	0.47	$2.29 billion	N/A	N/A
Bank of China	$169.73 billion	1.23	$33.81 billion	$2.57	6.30

Bank of China has higher revenue and earnings than Banco Santander Brasil.

Summary

Banco Santander Brasil beats Bank of China on 9 of the 14 factors compared between the two stocks.

About Banco Santander Brasil

Banco Santander (Brasil) S.A., together with its subsidiaries, provides various banking products and services to individuals, small and medium enterprises, and corporate customers in Brazil and internationally. The company operates through Commercial Banking and Global Wholesale Banking segments. It offers local loans, commercial financing options, development bank funds, and cash management services; export and import financing, guarantees, structuring of asset services. In addition, the company provides financing and advisory services for infrastructure projects and capital markets instruments, as well as offers equity transactions and mergers and acquisitions services. Further, it offers foreign exchange products, derivatives, and investments to institutional investors, corporate clients, and individuals. Additionally, the company provides research services, as well as offers brokerage services for corporate, institutional, and individual investors. Furthermore, it provides deposits and other bank funding instruments, and debit and credit cards. The company provides financial services and products to its customers through multichannel distribution network comprising branches, mini-branches, ATMs, call centers, Internet banking, and mobile banking. Banco Santander (Brasil) S.A. was incorporated in 1985 and is headquartered in São Paulo, Brazil. The company operates as a subsidiary of Banco Santander, S.A.

About Bank of China

Bank of China Limited, together with its subsidiaries, provides various banking and financial services in Chinese Mainland, Hong Kong, Macao, Taiwan, and internationally. It operates through six segments: Corporate Banking, Personal Banking, Treasury Operations, Investment Banking, Insurance, and Other. The Corporate Banking segment provides current accounts, deposits, overdrafts, loans, payments and settlements, trade-related products, and other credit facilities, as well as foreign currency, derivative, and wealth management products for corporate customers, government authorities, and financial institutions. The Personal Banking segment offers savings deposits, personal loans, credit cards and debit cards, payments and settlements, wealth management, and funds and insurance agency services to retail customers. The Treasury Operations segment offers foreign exchange transactions, customer-based interest rate, and foreign exchange derivative transactions, as well as money market transactions, proprietary trading, and asset and liability management. The Investment Banking segment provides debt and equity underwriting and financial advisory, sale and trading of securities, stock brokerage, investment research, asset management services, and private equity investment services. The Insurance segment provides underwriting services for general and life insurance business, and insurance agency services. In addition, the company operates debt-to-equity swaps and other supporting, and aircraft and financial leasing business. The company was founded in 1912 and is headquartered in Beijing, China.