Financial Contrast: Intercorp Financial Services (IFS) vs. The Competition

Intercorp Financial Services (NYSE:IFS) is one of 920 publicly-traded companies in the “Banks” industry, but how does it weigh in compared to its peers? We will compare Intercorp Financial Services to similar companies based on the strength of its profitability, valuation, analyst recommendations, institutional ownership, earnings, risk and dividends.

Dividends

Intercorp Financial Services pays an annual dividend of $1.71 per share and has a dividend yield of 3.7%. Intercorp Financial Services pays out 31.3% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 9.4% and pay out 28.9% of their earnings in the form of a dividend. Intercorp Financial Services has raised its dividend for 1 consecutive years. Intercorp Financial Services lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Profitability

This table compares Intercorp Financial Services and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Intercorp Financial Services	34.81%	17.06%	2.10%
Intercorp Financial Services Competitors	15.63%	9.45%	0.93%

Earnings and Valuation

This table compares Intercorp Financial Services and its peers gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Intercorp Financial Services	$7.15 billion	$542.25 million	8.51
Intercorp Financial Services Competitors	$37.72 billion	$2.41 billion	16.82

Intercorp Financial Services’ peers have higher revenue and earnings than Intercorp Financial Services. Intercorp Financial Services is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a summary of recent ratings and price targets for Intercorp Financial Services and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Intercorp Financial Services	0	2	1	0	2.33
Intercorp Financial Services Competitors	7458	30171	27726	1451	2.35

Intercorp Financial Services currently has a consensus price target of $62.00, suggesting a potential upside of 33.16%. As a group, “Banks” companies have a potential upside of 15.73%. Given Intercorp Financial Services’ higher possible upside, research analysts plainly believe Intercorp Financial Services is more favorable than its peers.

Institutional and Insider Ownership

47.7% of shares of all “Banks” companies are held by institutional investors. 9.8% of shares of all “Banks” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Intercorp Financial Services has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Intercorp Financial Services’ peers have a beta of 0.61, meaning that their average stock price is 39% less volatile than the S&P 500.

Summary

Intercorp Financial Services peers beat Intercorp Financial Services on 10 of the 15 factors compared.

About Intercorp Financial Services

Intercorp Financial Services Inc., together with its subsidiaries, offers banking, insurance, wealth management, and payment services for retail and commercial clients in Peru. The company provides loans, credit facilities, deposits, and current accounts; life annuity products with single-premium payment and conventional life insurance products, as well as other retail insurance products; and brokerage and investment management services. It engages in the development, management, operation, and processing of credit and debit cards; facilitation of payments and services through commercial stores; and installation and maintenance of infrastructure for transactions through electronic commerce modality and networks of payment methods processors. The company was incorporated in 1897 and is based in Lima, Peru. Intercorp Financial Services Inc. operates as a subsidiary of Intercorp Perú Ltd.