The PNC Financial Services Group (NYSE:PNC) vs. The Goldman Sachs Group (NYSE:GS) Head to Head Review

The PNC Financial Services Group (NYSE:PNC) and The Goldman Sachs Group (NYSE:GS) are both large-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, dividends, analyst recommendations, valuation and risk.

Insider and Institutional Ownership

83.5% of The PNC Financial Services Group shares are held by institutional investors. Comparatively, 71.2% of The Goldman Sachs Group shares are held by institutional investors. 0.4% of The PNC Financial Services Group shares are held by company insiders. Comparatively, 0.6% of The Goldman Sachs Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares The PNC Financial Services Group and The Goldman Sachs Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
The PNC Financial Services Group	$34.44 billion	2.25	$5.89 billion	$14.62	13.41
The Goldman Sachs Group	$126.85 billion	1.71	$14.28 billion	$45.38	15.56

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

Profitability

This table compares The PNC Financial Services Group and The Goldman Sachs Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
The PNC Financial Services Group	18.33%	11.07%	1.11%
The Goldman Sachs Group	12.37%	13.84%	0.89%

Analyst Ratings

This is a summary of current recommendations and price targets for The PNC Financial Services Group and The Goldman Sachs Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
The PNC Financial Services Group	1	7	10	1	2.58
The Goldman Sachs Group	1	11	5	0	2.24

The PNC Financial Services Group currently has a consensus target price of $212.76, indicating a potential upside of 8.54%. The Goldman Sachs Group has a consensus target price of $660.00, indicating a potential downside of 6.55%. Given The PNC Financial Services Group’s stronger consensus rating and higher possible upside, analysts clearly believe The PNC Financial Services Group is more favorable than The Goldman Sachs Group.

Dividends

The PNC Financial Services Group pays an annual dividend of $6.80 per share and has a dividend yield of 3.5%. The Goldman Sachs Group pays an annual dividend of $12.00 per share and has a dividend yield of 1.7%. The PNC Financial Services Group pays out 46.5% of its earnings in the form of a dividend. The Goldman Sachs Group pays out 26.4% 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. The PNC Financial Services Group has raised its dividend for 14 consecutive years and The Goldman Sachs Group has raised its dividend for 13 consecutive years. The PNC Financial Services Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

The PNC Financial Services Group has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500. Comparatively, The Goldman Sachs Group has a beta of 1.35, indicating that its share price is 35% more volatile than the S&P 500.

Summary

The PNC Financial Services Group beats The Goldman Sachs Group on 10 of the 18 factors compared between the two stocks.

About The PNC Financial Services Group

The PNC Financial Services Group, Inc. operates as a diversified financial services company in the United States. It operates through three segments: Retail Banking, Corporate & Institutional Banking, and Asset Management Group segments. The company's Retail Banking segment offers checking, savings, and money market accounts, as well as time deposit; residential mortgages, home equity loans and lines of credit, auto loans, credit cards, education loans, and personal and small business loans and lines of credit; and brokerage, insurance, and investment and cash management services. This segment serves consumer and small business customers through a network of branches, digital channels, ATMs, and through phone-based customer contact centers. Its Corporate & Institutional Banking segment provides secured and unsecured loans, letters of credit, and equipment leases; cash and investment management services, receivables and disbursement management services, funds transfer services, international payment services, and access to online/mobile information management and reporting; securities underwriting, loan syndications, customer-related trading, and mergers and acquisitions and equity capital markets advisory related services; and commercial loan servicing and technology solutions. It serves mid-sized and large corporations, and government and not-for-profit entities. The company's Asset Management Group segment offers investment and retirement planning, customized investment management, credit and cash management solutions, and trust management and administration services for high net worth and ultra high net worth individuals, and their families; and multi-generational family planning services for ultra high net worth individuals and their families. It also provides outsourced chief investment officer, custody, private real estate, cash and fixed income client solutions, and retirement plan fiduciary investment services for institutional clients. The company was founded in 1852 and is headquartered in Pittsburgh, Pennsylvania.

About The Goldman Sachs Group

The Goldman Sachs Group, Inc., a financial institution, provides a range of financial services for corporations, financial institutions, governments, and individuals worldwide. It operates through Global Banking & Markets, Asset & Wealth Management, and Platform Solutions segments. The Global Banking & Markets segment provides financial advisory services, including strategic advisory assignments related to mergers and acquisitions, divestitures, corporate defense activities, restructurings, and spin-offs; and relationship lending, and acquisition financing, as well as secured lending, through structured credit and asset-backed lending and involved in financing under securities to resale agreements. This segment also offers client execution activities for cash and derivative instruments; credit and interest rate products; and provision of mortgages, currencies, commodities, and equities related products, as well as underwriting services. The Asset & Wealth Management segment manages assets across various classes, including equity, fixed income, hedge funds, credit funds, private equity, real estate, currencies, and commodities; and provides customized investment advisory solutions, wealth advisory services, personalized financial planning, and private banking services, as well as invests in corporate equity, credit, real estate, and infrastructure assets. The Platform Solutions segment offers credit cards and point-of-sale financing for purchase of goods or services. This segment also provides cash management services, such as deposit-taking and payment solutions for corporate and institutional clients. The Goldman Sachs Group, Inc. was founded in 1869 and is headquartered in New York, New York.