KB Financial Group (NYSE: KB) and ING Groep (NYSE:ING) are both large-cap 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.
KB Financial Group pays an annual dividend of $1.47 per share and has a dividend yield of 2.6%. ING Groep pays an annual dividend of $0.61 per share and has a dividend yield of 3.5%. KB Financial Group pays out 19.8% of its earnings in the form of a dividend. ING Groep pays out 42.4% 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. ING Groep has increased its dividend for 2 consecutive years. ING Groep is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares KB Financial Group and ING Groep’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|KB Financial Group||22.77%||9.89%||0.78%|
Volatility and Risk
KB Financial Group has a beta of 1.32, suggesting that its stock price is 32% more volatile than the S&P 500. Comparatively, ING Groep has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500.
This is a breakdown of recent ratings and price targets for KB Financial Group and ING Groep, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|KB Financial Group||0||0||1||0||3.00|
Insider & Institutional Ownership
5.8% of KB Financial Group shares are owned by institutional investors. Comparatively, 3.2% of ING Groep shares are owned by institutional investors. 69.0% of KB Financial Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Valuation and Earnings
This table compares KB Financial Group and ING Groep’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|KB Financial Group||$13.29 billion||1.68||$2.98 billion||$7.43||7.48|
|ING Groep||$20.00 billion||3.37||$6.18 billion||$1.44||12.06|
ING Groep has higher revenue and earnings than KB Financial Group. KB Financial Group is trading at a lower price-to-earnings ratio than ING Groep, indicating that it is currently the more affordable of the two stocks.
ING Groep beats KB Financial Group on 10 of the 15 factors compared between the two stocks.
KB Financial Group Company Profile
KB Financial Group Inc., a financial holding company, provides various banking and related financial services to individuals and corporations in South Korea and internationally. It operates through six segments: Retail Banking Operations, Corporate Banking Operations, Other Banking Operations, Credit Card Operations, Investment and Securities Operations, and Life Insurance Operations. The company offers deposit products, including demand deposits, time deposits, savings deposits, certificates of deposit, foreign currency deposits; and loans, such as mortgages and home equity, other consumer loans, working capital and facilities loans, as well as credit cards. It also provides debt and equity securities investment and trading, derivatives trading, asset securitizations, and call loans; securities brokerage services; foreign exchange, import and export-related, offshore lending, syndicated loans, and foreign currency securities investment services; trustee and custodian services; trust account management services; management of the national housing fund; and bancassurance, insurance, and consumer finance services. In addition, the company offers investment banking services consisting of project finance and financial advisory services; structured finance; and financing for mergers and acquisitions. Further, it provides investment advisory services; real estate trust management; financial leasing services; and life insurance and wealth management products, as well as Internet and phone banking services, as well as offers non-life insurance products and services. As of December 31, 2016, the company operated a network of 1,130 branches and sub-branches in Korea. KB Financial Group Inc. was founded in 2008 and is headquartered in Seoul, South Korea.
ING Groep Company Profile
ING Groep N.V. (ING) is a financial institution. The Company offers banking services. The Company’s segments include Retail Netherlands, which offers current and savings accounts, business lending, mortgages and other consumer lending in the Netherlands; Retail Belgium, which offers products that are similar to those in the Netherlands; Retail Germany, which offers current and savings accounts, mortgages and other customer lending; Retail Other, which offers products that are similar to those in the Netherlands, and Wholesale Banking, which offers wholesale banking activities (a full range of products from cash management to corporate finance), real estate and lease. The Company’s Retail Banking business lines provide products and services to individuals, small and medium-sized enterprises (SMEs) and mid-corporates. ING’s banking activities in Australia are undertaken by ING Bank (Australia) Limited (trading as ING Direct) and ING Bank NV Sydney Branch.
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