Standard Chartered (OTCMKTS:SCBFF) versus Capital One Financial (NYSE:COF) Critical Analysis

Standard Chartered (OTCMKTS:SCBFF) and Capital One Financial (NYSE:COF) are both large-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Insider & Institutional Ownership

90.1% of Capital One Financial shares are owned by institutional investors. 1.4% of Capital One Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Standard Chartered has a beta of 0.73, suggesting that its share price is 27% less volatile than the S&P 500. Comparatively, Capital One Financial has a beta of 1.47, suggesting that its share price is 47% more volatile than the S&P 500.

Valuation & Earnings

This table compares Standard Chartered and Capital One Financial’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Standard Chartered	$23.98 billion	0.89	$2.95 billion	$0.89	8.77
Capital One Financial	$38.37 billion	1.04	$7.36 billion	$13.31	7.89

Capital One Financial has higher revenue and earnings than Standard Chartered. Capital One Financial is trading at a lower price-to-earnings ratio than Standard Chartered, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Standard Chartered and Capital One Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Standard Chartered	11.27%	6.96%	0.42%
Capital One Financial	11.43%	9.77%	1.13%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Standard Chartered and Capital One Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Standard Chartered	1	3	0	0	1.75
Capital One Financial	4	6	4	0	2.00

Standard Chartered currently has a consensus price target of $930.00, suggesting a potential upside of 11,815.44%. Capital One Financial has a consensus price target of $106.36, suggesting a potential upside of 1.29%. Given Standard Chartered’s higher possible upside, analysts plainly believe Standard Chartered is more favorable than Capital One Financial.

Dividends

Standard Chartered pays an annual dividend of $0.12 per share and has a dividend yield of 1.5%. Capital One Financial pays an annual dividend of $2.40 per share and has a dividend yield of 2.3%. Standard Chartered pays out 13.5% of its earnings in the form of a dividend. Capital One Financial pays out 18.0% 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.

Summary

Capital One Financial beats Standard Chartered on 13 of the 16 factors compared between the two stocks.

About Standard Chartered

Standard Chartered PLC, together with its subsidiaries, provides various banking products and services primarily in Asia, Africa, Europe, the Americas, and the Middle East. The company operates through two segments: Corporate, Commercial and Institutional Banking; and Consumer, Private and Business Banking. It offers retail products, such as deposits, savings, mortgages, credit cards, and personal loans; wealth management products and services that include investments, portfolio management, insurance, and wealth advices; and transaction banking services, such as cash management, working capital, and trade financing products. The company also provides financial markets products and services that comprise project and transportation financing, debt capital markets and leveraged financing, financing and securities services, and sales and structuring services, as well as macro, commodities, and credit trading services. In addition, it offers digital banking solutions. The company serves financial institutions, governments, banks, investors, corporations, small businesses, and individuals. The company was founded in 1853 and is headquartered in London, the United Kingdom.

About Capital One Financial

Capital One Financial Corporation operates as the financial services holding company for the Capital One Bank (USA), National Association; and Capital One, National Association, which provides various financial products and services in the United States, Canada, and the United Kingdom. It operates through three segments: Credit Card, Consumer Banking, and Commercial Banking. The company accepts checking accounts, money market deposits, negotiable order of withdrawals, savings deposits, and time deposits. Its loan products include credit card loans; auto and retail banking loans; and commercial and multifamily real estate, and commercial and industrial loans. The company also offers credit and debit card products; online direct banking services; and treasury management and depository services. It serves consumers, small businesses, and commercial clients through digital channels, branches, cafés, and other distribution channels located in New York, Louisiana, Texas, Maryland, Virginia, New Jersey, and California. Capital One Financial Corporation was founded in 1988 and is headquartered in McLean, Virginia.