Critical Comparison: Banco Bradesco (NYSE:BBDO) vs. BBVA Banco Frances (NYSE:BBAR)

Banco Bradesco (NYSE:BBDO) and BBVA Banco Frances (NYSE:BBAR) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, institutional ownership, valuation and risk.

Risk & Volatility

Banco Bradesco has a beta of 0.58, meaning that its share price is 42% less volatile than the S&P 500. Comparatively, BBVA Banco Frances has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500.

Valuation & Earnings

This table compares Banco Bradesco and BBVA Banco Frances”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Bradesco	$41.79 billion	N/A	$4.24 billion	$0.39	8.38
BBVA Banco Frances	$4.96 billion	0.57	$396.45 million	$0.95	14.57

Banco Bradesco has higher revenue and earnings than BBVA Banco Frances. Banco Bradesco is trading at a lower price-to-earnings ratio than BBVA Banco Frances, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Banco Bradesco and BBVA Banco Frances, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Bradesco	0	0	1	0	3.00
BBVA Banco Frances	0	3	2	2	2.86

BBVA Banco Frances has a consensus target price of $17.67, indicating a potential upside of 27.65%. Given BBVA Banco Frances’ higher probable upside, analysts clearly believe BBVA Banco Frances is more favorable than Banco Bradesco.

Profitability

This table compares Banco Bradesco and BBVA Banco Frances’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Bradesco	9.85%	13.78%	1.11%
BBVA Banco Frances	3.70%	6.55%	0.97%

Dividends

Banco Bradesco pays an annual dividend of $0.02 per share and has a dividend yield of 0.6%. BBVA Banco Frances pays an annual dividend of $0.42 per share and has a dividend yield of 3.0%. Banco Bradesco pays out 5.1% of its earnings in the form of a dividend. BBVA Banco Frances pays out 44.2% 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.

About Banco Bradesco

Banco Bradesco S.A., together with its subsidiaries, provides various banking products and services to individuals, corporates, and businesses in Brazil and internationally. The company operates through two segments, Banking and Insurance. It provides current, savings, click, and salary accounts; real estate credit, vehicle financing, payroll loans, mortgage loans, microcredit, leasing, and personal and installment credit; overdraft and agribusiness loans; debit and business cards; financial and security services; consortium products; car, personal accident, dental, travel, and life insurance; investment products; pension products; foreign currency exchange services; capitalization bonds; and internet banking services. Banco Bradesco S.A. was founded in 1943 and is headquartered in Osasco, Brazil.

About BBVA Banco Frances

Banco BBVA Argentina S.A. provides various banking products and services to individuals and companies in Argentina. The company provides retail banking products and services, such as checking and savings accounts, time deposits, credit cards financing, consumer and pledge loans, mortgages, insurance, and investment products to individuals; and small and medium-sized companies products and services, including financing products, factoring, checking accounts, time deposits, transactional and payroll services, insurance, and investment products to private-sector companies. It also provides corporate and investment banking products and services, such as global transaction services; global markets solutions comprising risk management and securities brokerage; long-term financing products, including project finance and syndicated loans; and corporate finance services comprising mergers and acquisitions, and capital markets advisory services to corporations and multinational companies. The company was formerly known as BBVA Banco Francés S.A. and changed its name to Banco BBVA Argentina S.A. in July 2019. Banco BBVA Argentina S.A. was incorporated in 1886 and is based in Buenos Aires, Argentina.