City Bank (OTCMKTS:CTBK) versus The Bank of Nova Scotia (NYSE:BNS) Critical Survey

City Bank (OTCMKTS:CTBK) and The Bank of Nova Scotia (NYSE:BNS) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, risk, valuation, earnings, institutional ownership, analyst recommendations and dividends.

Earnings & Valuation

This table compares City Bank and The Bank of Nova Scotia’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
City Bank N/A N/A N/A N/A N/A
The Bank of Nova Scotia $32.52 billion 2.38 $5.04 billion $3.99 15.96

The Bank of Nova Scotia has higher revenue and earnings than City Bank.

Risk and Volatility

City Bank has a beta of 1.84, meaning that its stock price is 84% more volatile than the S&P 500. Comparatively, The Bank of Nova Scotia has a beta of 0.97, meaning that its stock price is 3% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for City Bank and The Bank of Nova Scotia, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
City Bank 0 0 0 0 N/A
The Bank of Nova Scotia 2 1 6 0 2.44

The Bank of Nova Scotia has a consensus price target of $76.00, indicating a potential upside of 19.35%. Given The Bank of Nova Scotia’s higher possible upside, analysts clearly believe The Bank of Nova Scotia is more favorable than City Bank.

Institutional and Insider Ownership

45.9% of The Bank of Nova Scotia shares are held by institutional investors. 37.5% of City Bank shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares City Bank and The Bank of Nova Scotia’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
City Bank N/A N/A N/A
The Bank of Nova Scotia 15.57% 10.47% 0.59%

Summary

The Bank of Nova Scotia beats City Bank on 7 of the 9 factors compared between the two stocks.

City Bank Company Profile

As of April 17, 2010, City Bank was acquired by Whidbey Island Bank. City Bank offers commercial banking services. The company was incorporated in 1974 and is headquartered in Lynnwood, Washington.

The Bank of Nova Scotia Company Profile

The Bank of Nova Scotia provides various banking products and services in Canada, the United States, Mexico, Peru, Chile, Colombia, the Caribbean and Central America, and internationally. It operates through Canadian Banking, International Banking, Global Banking and Markets, and Global Wealth Management segments. The company offers financial advice and solutions, and day-to-day banking products, including debit and credit cards, chequing and saving accounts, investments, mortgages, loans, and insurance to individuals; and business banking solutions comprising lending, deposit, cash management, and trade finance solutions to small businesses and commercial customers, including automotive financing solutions to dealers and their customers. It also provides wealth management advice and solutions, including online brokerage, mobile investment, full-service brokerage, trust, private banking, and private investment counsel services; and retail mutual funds, exchange traded funds, liquid alternative funds, and institutional funds. In addition, the company offers international banking services for retail, corporate, and commercial customers; and lending and transaction, investment banking advisory, and capital markets access services to corporate customers. Further, it provides Internet, mobile, and telephone banking services. The company operates a network of 952 branches and approximately 3,540 automated banking machines in Canada; and approximately 1,400 branches, 5,200 ATMs, and 22 contact centers internationally. The Bank of Nova Scotia was founded in 1832 and is headquartered in Halifax, Canada.

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