Reviewing DNB Bank ASA (OTCMKTS:DNBBY) and Shinhan Financial Group (NYSE:SHG)

Shinhan Financial Group (NYSE:SHG) and DNB Bank ASA (OTCMKTS:DNBBY) are both large-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, profitability, analyst recommendations and institutional ownership.

Earnings and Valuation

This table compares Shinhan Financial Group and DNB Bank ASA”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shinhan Financial Group	$23.83 billion	1.60	$3.48 billion	$7.44	10.94
DNB Bank ASA	$19.14 billion	2.71	$4.20 billion	$2.80	11.94

DNB Bank ASA has lower revenue, but higher earnings than Shinhan Financial Group. Shinhan Financial Group is trading at a lower price-to-earnings ratio than DNB Bank ASA, indicating that it is currently the more affordable of the two stocks.

Dividends

Shinhan Financial Group pays an annual dividend of $1.71 per share and has a dividend yield of 2.1%. DNB Bank ASA pays an annual dividend of $1.42 per share and has a dividend yield of 4.2%. Shinhan Financial Group pays out 23.0% of its earnings in the form of a dividend. DNB Bank ASA pays out 50.7% 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.

Profitability

This table compares Shinhan Financial Group and DNB Bank ASA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shinhan Financial Group	15.69%	8.63%	0.66%
DNB Bank ASA	21.34%	13.97%	1.06%

Insider and Institutional Ownership

7.8% of Shinhan Financial Group shares are owned by institutional investors. 1.0% of Shinhan Financial Group shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

Shinhan Financial Group has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, DNB Bank ASA has a beta of 0.65, suggesting that its share price is 35% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Shinhan Financial Group and DNB Bank ASA, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shinhan Financial Group	0	1	1	0	2.50
DNB Bank ASA	2	4	2	0	2.00

Summary

DNB Bank ASA beats Shinhan Financial Group on 8 of the 15 factors compared between the two stocks.

About Shinhan Financial Group

Shinhan Financial Group Co., Ltd. provides financial products and services in South Korea and internationally. The company operates through six segments: Banking, Credit Card, Securities, Insurance, Credit, and Others. It offers retail banking services, including demand, savings, and fixed deposit-taking; checking accounts; mortgage and home equity, and retail lending; electronic banking and automatic teller machines (ATM); and bill paying, payroll and check-cashing, currency exchange, and wire fund transfer services. The company also provides corporate banking services, such as investment banking, real estate financing, overseas real estate and development project financing, infrastructure and structured financing, equity/venture investments, mergers and acquisitions consulting; securitization and derivatives services comprising securities and derivative products, and foreign exchange trading; business expansion financing and consulting services; and working capital loans and facilities loans. In addition, it is involved in treasury and investment activities in international capital markets consisting of foreign currency-denominated securities trading, foreign exchange trading and services, trade-related financial services, international factoring services, and foreign banking operations. Further, the company offers real estate trust, investment advisory, venture business investment, life and non-life insurance, trust account management, securities brokerage, and asset management services, as well as leasing and equipment financing, savings banking, loan collection and credit reporting, collective investment administration, private equity investment, and financial system development services. Additionally, it provides transaction history inquiries and fund transfers, opening letters of credit, trade finance, payment and collection management, sales and acquisition settlement, business-to-business settlement, sweeping, pooling, ERP interface, host-to-host banking, SWIFT SCORE, and cash and liquidity management service. Shinhan Financial Group Co., Ltd. was founded in 1982 and is headquartered in Seoul, South Korea.

About DNB Bank ASA

DNB Bank ASA provides financial services for individual and business customers in Norway and internationally. The company offers savings, current, and pension accounts; fixed rate and security deposits; home and cabin mortgages, car and consumer loans, business loans, and refinancing; car, house, home contents, travel, personal, and non-life insurance product; payment services; and online and mobile banking services, as well as cards. It also provides overdraft facilities; leasing services; factoring, supply chain, and receivable purchase financing services; bank guarantee, secure trading, documentary collection, and letter of credit services; investment banking services, such as mergers and acquisition, equity and debt capital market, shares and securities, mutual funds and trading, and bonds and commodities; and private financing, as well as equity trading, foreign exchange, interest rates, and risk advisory services. In addition, the company offers treasury management, working capital, trade finance, auto lease and equipment financing, and corporate finance services, as well as act as an estate agents. DNB Bank ASA was founded in 1822 and is headquartered in Oslo, Norway.