Critical Survey: DNB Bank ASA (OTCMKTS:DNBBY) versus China Construction Bank (OTCMKTS:CICHY)

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

Dividends

DNB Bank ASA pays an annual dividend of $1.18 per share and has a dividend yield of 3.6%. China Construction Bank pays an annual dividend of $0.80 per share and has a dividend yield of 3.5%. DNB Bank ASA pays out 43.1% of its earnings in the form of a dividend. China Construction Bank pays out 22.1% 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.

Earnings and Valuation

This table compares DNB Bank ASA and China Construction Bank”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DNB Bank ASA	$19.14 billion	2.64	$4.20 billion	$2.74	11.88
China Construction Bank	$181.98 billion	1.64	$47.15 billion	$3.62	6.28

China Construction Bank has higher revenue and earnings than DNB Bank ASA. China Construction Bank 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.

Risk and Volatility

DNB Bank ASA has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500. Comparatively, China Construction Bank has a beta of 0.08, indicating that its share price is 92% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for DNB Bank ASA and China Construction Bank, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DNB Bank ASA	1	4	2	1	2.38
China Construction Bank	0	1	0	0	2.00

Profitability

This table compares DNB Bank ASA and China Construction Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DNB Bank ASA	21.00%	14.72%	1.10%
China Construction Bank	25.79%	9.73%	0.77%

Summary

DNB Bank ASA beats China Construction Bank on 9 of the 14 factors compared between the two stocks.

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.

About China Construction Bank

China Construction Bank Corporation provides various banking and related financial services to individuals and corporate customers in the People's Republic of China and internationally. It operates through Corporate Finance Business, Personal Finance Business, Treasury and Asset Management Business, and Others segments. The company accepts various deposits, such as foreign currency, all in one accounts, RMB, corporate term and notification, and corporate demand deposits, as well corporate deposits by agreement. Its loan products include personal business, car, and housing loans; and SME, traditional credit, commercial draft, buyer credit, and RMB credit line loans. The company also offers credit cards; physical gold for personal investment and personal gold accounts; foreign exchange services; certificate treasury and savings bonds, securities deposit accounts, and securities services, as well as bank-securities transfer and book-entry treasury bond over the counter transaction services; and wealth management products. In addition, it provides collection, salaries payment, third-party collection and payment, insurance agency, and remittance services; international settlement and financing, and FI services; securities and fund settlement services; guarantee-based, consulting and advising, and factoring services; fund custody services; and e-banking services. Further, the company offers institutional services comprising services for government agencies, social security, banks cooperation, bank-securities cooperation, bank-insurance cooperation, and services for non-banking financial institutions. China Construction Bank Corporation was founded in 1954 and is headquartered in Beijing, the People's Republic of China.