Intercorp Financial Services (NYSE:IFS) versus Banco Itau Chile Spon (NASDAQ:ITCLY) Financial Contrast

Banco Itau Chile Spon (NASDAQ:ITCLY) and Intercorp Financial Services (NYSE:IFS) are both mid-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, institutional ownership, valuation, earnings, dividends, risk and analyst recommendations.

Dividends

Banco Itau Chile Spon pays an annual dividend of $0.17 per share and has a dividend yield of 5.5%. Intercorp Financial Services pays an annual dividend of $0.95 per share and has a dividend yield of 4.0%. Banco Itau Chile Spon pays out 25.8% of its earnings in the form of a dividend. Intercorp Financial Services pays out 42.8% 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. Banco Itau Chile Spon is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Banco Itau Chile Spon and Intercorp Financial Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Itau Chile Spon	10.54%	10.65%	0.91%
Intercorp Financial Services	15.76%	9.61%	1.05%

Institutional and Insider Ownership

22.2% of Banco Itau Chile Spon shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Banco Itau Chile Spon and Intercorp Financial Services’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Itau Chile Spon	$3.99 billion	0.50	$423.68 million	$0.66	4.70
Intercorp Financial Services	$6.13 billion	0.45	$286.85 million	$2.22	10.69

Banco Itau Chile Spon has higher earnings, but lower revenue than Intercorp Financial Services. Banco Itau Chile Spon is trading at a lower price-to-earnings ratio than Intercorp Financial Services, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Banco Itau Chile Spon and Intercorp Financial Services, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Itau Chile Spon	0	0	0	0	N/A
Intercorp Financial Services	0	0	2	0	3.00

Intercorp Financial Services has a consensus price target of $33.45, suggesting a potential upside of 40.96%. Given Intercorp Financial Services’ higher possible upside, analysts plainly believe Intercorp Financial Services is more favorable than Banco Itau Chile Spon.

Summary

Intercorp Financial Services beats Banco Itau Chile Spon on 7 of the 13 factors compared between the two stocks.

About Banco Itau Chile Spon

Banco Ita? Chile provides banking services principally in Chile and Colombia. It provides wholesale and corporate banking; real estate and construction and retail, private, companies and personal banking services, as well as treasury and other financial services. Banco Ita? Chile, formerly known as Ita? Corpbanca, is based in Santiago, Chile.

About Intercorp Financial Services

Intercorp Financial Services Inc., together with its subsidiaries, offers banking, insurance, wealth management, and payment services for retail and commercial clients in Peru. The company provides loans, credit facilities, deposits, and current accounts; life annuity products with single-premium payment and conventional life insurance products, as well as other retail insurance products; and brokerage and investment management services. It engages in the development, management, operation, and processing of credit and debit cards; facilitation of payments and services through commercial stores; and installation and maintenance of infrastructure for transactions through electronic commerce modality and networks of payment methods processors. The company was incorporated in 1897 and is based in Lima, Peru. Intercorp Financial Services Inc. operates as a subsidiary of Intercorp Perú Ltd.