Industrial & Commercial Bank of China Ltd. (OTCMKTS:IDCBY) versus Nordea Bank (OTCMKTS:NRDBY) Critical Contrast

Industrial & Commercial Bank of China Ltd. (OTCMKTS:IDCBY) and Nordea Bank (OTCMKTS:NRDBY) are both large-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Institutional & Insider Ownership

0.0% of Nordea Bank shares are held by institutional investors. 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.

Analyst Ratings

This is a summary of recent recommendations for Industrial & Commercial Bank of China Ltd. and Nordea Bank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Industrial & Commercial Bank of China Ltd.	0	0	0	0	0.00
Nordea Bank	1	3	2	1	2.43

Profitability

This table compares Industrial & Commercial Bank of China Ltd. and Nordea Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Industrial & Commercial Bank of China Ltd.	24.10%	8.96%	0.71%
Nordea Bank	21.42%	15.38%	0.75%

Dividends

Industrial & Commercial Bank of China Ltd. pays an annual dividend of $0.60 per share and has a dividend yield of 3.8%. Nordea Bank pays an annual dividend of $0.47 per share and has a dividend yield of 2.5%. Industrial & Commercial Bank of China Ltd. pays out 21.9% of its earnings in the form of a dividend. Nordea Bank pays out 30.9% 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. Industrial & Commercial Bank of China Ltd. is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Industrial & Commercial Bank of China Ltd. has a beta of 0.14, indicating that its stock price is 86% less volatile than the S&P 500. Comparatively, Nordea Bank has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500.

Valuation and Earnings

This table compares Industrial & Commercial Bank of China Ltd. and Nordea Bank”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Industrial & Commercial Bank of China Ltd.	$219.33 billion	1.28	$50.89 billion	$2.74	5.73
Nordea Bank	$26.50 billion	2.48	$5.47 billion	$1.52	12.58

Industrial & Commercial Bank of China Ltd. has higher revenue and earnings than Nordea Bank. Industrial & Commercial Bank of China Ltd. is trading at a lower price-to-earnings ratio than Nordea Bank, indicating that it is currently the more affordable of the two stocks.

Summary

Nordea Bank beats Industrial & Commercial Bank of China Ltd. on 9 of the 15 factors compared between the two stocks.

About Industrial & Commercial Bank of China Ltd.

Industrial and Commercial Bank of China Limited, together with its subsidiaries, provides banking products and services in the People's Republic of China and internationally. The company operates through Corporate Banking, Personal Banking, and Treasury Operations segments. The Corporate Banking segment offers financial products and services to corporations, government agencies, and financial institutions. Its products and services include trade financing, deposit, corporate wealth management, custody, and various corporate intermediary services, as well as corporate loans. Its Personal Banking segment provides financial products and services to individual customers. This segment's products and services comprise personal loans and cards, deposits, and personal wealth management and intermediary services. The Treasury Business segment is involved in the money market transactions, investment securities, and proprietary and foreign exchange transactions businesses. It also offers e-banking services, investment banking, financial leasing, and insurance services. Industrial and Commercial Bank of China Limited was incorporated in 1984 and is based in Beijing, the People's Republic of China.

About Nordea Bank

Nordea Bank Abp offers banking products and services in Sweden, Finland, Norway, Denmark, and internationally. It operates through Personal Banking, Business Banking, Large Corporates & Institutions, and Asset & Wealth Management segments. The Personal Banking segment provides various financial services to customers through mobile banking, over the phone, online meetings, and branch offices. The Business Banking segment offers payments, cash management, cards, working capital management, and cards and finance solutions to corporate and personal customers. The Large Corporates & Institutions segment provides financing, cash management and payment, investment banking, capital market products, and securities services to corporate and institutional customers. The Asset & Wealth Management segment offers investment, savings, and risk management solutions to high net worth individuals and institutional investors. It also offers account-based products, such as lending and deposit; project finance services, asset-based financing through leasing, hire purchase, and factoring, as well as sales to finance partners, such as dealers, vendors, and retailers; financial instruments or arrangement for financial instruments, including currencies, commodities, stocks, and bonds; and asset management, including investment funds, discretionary management, portfolio advice, equity trading, and pension accounts, as well as life insurance and pension products and services. Nordea Bank Abp was founded in 1820 and is headquartered in Helsinki, Finland.