National Australia Bank (OTCMKTS:NABZY) vs. Royal Bank Of Canada (NYSE:RY) Financial Analysis

National Australia Bank (OTCMKTS:NABZY) and Royal Bank Of Canada (NYSE:RY) are both large-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, profitability, earnings, dividends, valuation, risk and analyst recommendations.

Dividends

National Australia Bank pays an annual dividend of $0.52 per share and has a dividend yield of 3.6%. Royal Bank Of Canada pays an annual dividend of $4.72 per share and has a dividend yield of 2.6%. Royal Bank Of Canada pays out 45.2% of its earnings in the form of a dividend. Royal Bank Of Canada has raised its dividend for 15 consecutive years.

Valuation & Earnings

This table compares National Australia Bank and Royal Bank Of Canada”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
National Australia Bank	$38.78 billion	2.26	$4.35 billion	N/A	N/A
Royal Bank Of Canada	$98.11 billion	2.59	$14.54 billion	$10.45	17.39

Royal Bank Of Canada has higher revenue and earnings than National Australia Bank.

Insider & Institutional Ownership

45.3% of Royal Bank Of Canada shares are held by institutional investors. 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.

Profitability

This table compares National Australia Bank and Royal Bank Of Canada’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
National Australia Bank	N/A	N/A	N/A
Royal Bank Of Canada	15.28%	17.12%	0.94%

Analyst Ratings

This is a summary of recent ratings and price targets for National Australia Bank and Royal Bank Of Canada, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
National Australia Bank	2	1	0	2	2.40
Royal Bank Of Canada	0	3	11	0	2.79

National Australia Bank presently has a consensus target price of $38.00, suggesting a potential upside of 165.36%. Royal Bank Of Canada has a consensus target price of $162.00, suggesting a potential downside of 10.83%. Given National Australia Bank’s higher possible upside, equities research analysts clearly believe National Australia Bank is more favorable than Royal Bank Of Canada.

Volatility & Risk

National Australia Bank has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500. Comparatively, Royal Bank Of Canada has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500.

Summary

Royal Bank Of Canada beats National Australia Bank on 10 of the 15 factors compared between the two stocks.

About National Australia Bank

National Australia Bank Limited provides financial services to individuals and businesses in Australia, New Zealand, and internationally. The company operates through Business and Private Banking; Personal Banking; Corporate and Institutional Banking; New Zealand Banking; and Corporate Functions and Other segments. It accepts transaction accounts, savings accounts, debit cards, and term deposits; and specialized accounts, such as foreign currency, business interest, cash maximiser, farm management, community free saver, statutory trust, and project bank accounts, as well as farm management deposits. In addition, the company provides home loans, personal loans, and business loans; vehicle and equipment finance; and trade and invoice finance, as well as business overdrafts and bank guarantees. Further, it offers insurance products consisting of home and content, landlord, travel, car, caravan and trailer, life, and business insurance products; and pension, self-managed super funds, cash management, and financial planning and advisory services. Additionally, the company provides investment products; credit, debit, and business cards; payments and merchant services; online and internet banking services; small business services; international and foreign exchange solutions; and industry specific banking services. The company was founded in 1834 and is based in Melbourne, Australia.

About Royal Bank Of Canada

Royal Bank of Canada operates as a diversified financial service company worldwide. The company's Personal & Commercial Banking segment offers checking and savings accounts, home equity financing, personal lending, private banking, indirect lending, including auto financing, mutual funds and self-directed brokerage accounts, guaranteed investment certificates, credit cards, and payment products and solutions; and lending, leasing, deposit, investment, foreign exchange, cash management, auto dealer financing, trade products, and services to small and medium-sized commercial businesses. This segment offers financial products and services through branches, automated teller machines, and mobile sales network. Its Wealth Management segment provides a suite of wealth, investment, trust, banking, credit, and other advice-based solutions and strategies to high net worth and ultra-high net worth individuals, and institutional clients; asset management products to institutional and individual clients; and asset and investor services to financial institutions, asset managers, and asset owners. The company's Insurance segment offers life, health, home, auto, travel, wealth, annuities, property and casualty, and reinsurance advice and solutions; and business insurance services to individual, business, and group clients through its advice centers, RBC insurance stores, and mobile advisors; digital platforms; and independent brokers and partners. The company's Capital Markets segment offers advisory and origination, sales and trading, lending and financing, and transaction banking services to corporations, institutional clients, asset managers, private equity firms, and governments. The company was founded in 1864 and is headquartered in Toronto, Canada.