Reviewing Arrow Financial (NASDAQ:AROW) & Mizuho Financial Group (NYSE:MFG)

Arrow Financial (NASDAQ:AROWGet Free Report) and Mizuho Financial Group (NYSE:MFGGet Free Report) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.

Dividends

Arrow Financial pays an annual dividend of $1.08 per share and has a dividend yield of 4.3%. Mizuho Financial Group pays an annual dividend of $0.05 per share and has a dividend yield of 1.2%. Arrow Financial pays out 62.8% of its earnings in the form of a dividend. Mizuho Financial Group pays out 16.7% 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. Arrow Financial has increased its dividend for 6 consecutive years. Arrow Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Arrow Financial and Mizuho Financial Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Arrow Financial 14.34% 7.89% 0.69%
Mizuho Financial Group 6.45% 5.24% 0.19%

Institutional & Insider Ownership

46.7% of Arrow Financial shares are held by institutional investors. Comparatively, 3.3% of Mizuho Financial Group shares are held by institutional investors. 3.6% of Arrow Financial shares are held by company insiders. Comparatively, 0.0% of Mizuho Financial Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

Arrow Financial has a beta of 0.75, meaning that its share price is 25% less volatile than the S&P 500. Comparatively, Mizuho Financial Group has a beta of 0.39, meaning that its share price is 61% less volatile than the S&P 500.

Valuation & Earnings

This table compares Arrow Financial and Mizuho Financial Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Arrow Financial $191.68 million 2.16 $30.08 million $1.72 14.44
Mizuho Financial Group $3,260.36 billion 0.02 $4.69 billion $0.30 13.42

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

Analyst Recommendations

This is a summary of current ratings for Arrow Financial and Mizuho Financial Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Arrow Financial 0 1 0 0 2.00
Mizuho Financial Group 0 0 1 0 3.00

Summary

Arrow Financial beats Mizuho Financial Group on 11 of the 16 factors compared between the two stocks.

About Arrow Financial

(Get Free Report)

Arrow Financial Corporation, a bank holding company, provides commercial and consumer banking, and financial products and services. The company's deposit products include demand deposits, interest-bearing checking accounts, savings deposits, time deposits, and other time deposits. Its lending activities comprise commercial loans, such as term loans, time notes, and lines of credit; and commercial real estate loans to finance real estate purchases, refinancing, expansions, and enhancement to commercial properties, as well as commercial construction and land development loans to finance projects. The company's lending activities also include consumer installment loans to finance personal expenditures, personal lines of credit, overdraft protection, and automobile loans; and residential real estate loans, fixed home equity loans, and home equity lines of credit for consumers to finance home improvements, debt consolidation, education, and other uses. In addition, it maintains an indirect lending program. Further, the company provides retirement planning, trust, and estate administration services for individuals, as well as pension, profit-sharing, and employee benefit plan administration services for corporations. Additionally, it offers insurance agency services comprising group health care policies and life insurance, and property and casualty insurance products; and investment advisory services to its proprietary mutual funds, as well as holds a real estate investment trust. It operates in the northeastern region of New York State in Warren, Washington, Saratoga, Essex, Clinton, Rensselaer, Albany, and Schenectady counties. Arrow Financial Corporation was founded in 1851 and is headquartered in Glens Falls, New York.

About Mizuho Financial Group

(Get Free Report)

Mizuho Financial Group, Inc., together with its subsidiaries, engages in banking, trust, securities, and other businesses related to financial services in Japan, the Americas, Europe, Asia/Oceania, and internationally. It operates through Retail & Business Banking Company, Corporate & Institutional Company, Global Corporate Company, Global Markets Company, Asset Management Company, and Others segments. The company provides deposit products; syndicated, housing, and card loans; business matching services; and advisory services related to overseas expansions, and mergers and acquisitions-related services. It also offers consulting services, including asset management and asset succession; payroll services; and sells lottery tickets issued by prefectures and ordinance-designated cities. In addition, it offers fund management, underwriting of equity and bonds, risk hedging products, etc. for corporate customers; solutions based on capital management, business strategy, and financial strategy; real estate services; advisory services and solutions, such as advice on proposals on various investment products to financial institutions; and financial services that include funding support and public bonds underwriting. Further, the company offers corporate finance and transaction banking srvices; sales and trading services; investment products; pension funds; and ALM and investment services, including stable capital raising and balance sheet management, as well as management of fixed income, equity, and other securities portfolios. Additionally, the company provides online banking, cash management solutions, currency transaction, trade finance, custody, yen correspondence settlement, and research and consulting services; trust, securitization and structured finance, and stock transfers; and private banking and information technology-related services. Mizuho Financial Group, Inc. was founded in 2000 and is headquartered in Tokyo, Japan.

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