Reviewing KBC Group (OTCMKTS:KBCSY) and Raiffeisen Bank International (OTCMKTS:RAIFY)

Raiffeisen Bank International (OTCMKTS:RAIFY) and KBC Group (OTCMKTS:KBCSY) are both large-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, risk, dividends, institutional ownership, analyst recommendations, earnings and valuation.

Volatility and Risk

Raiffeisen Bank International has a beta of 1.1, suggesting that its share price is 10% more volatile than the S&P 500. Comparatively, KBC Group has a beta of 0.55, suggesting that its share price is 45% less volatile than the S&P 500.

Earnings & Valuation

This table compares Raiffeisen Bank International and KBC Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Raiffeisen Bank International	$14.76 billion	1.03	$1.55 billion	$1.08	10.67
KBC Group	$26.56 billion	2.01	$4.04 billion	$4.96	12.88

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

Dividends

Raiffeisen Bank International pays an annual dividend of $0.18 per share and has a dividend yield of 1.6%. KBC Group pays an annual dividend of $0.67 per share and has a dividend yield of 1.0%. Raiffeisen Bank International pays out 16.7% of its earnings in the form of a dividend. KBC Group pays out 13.5% 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.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Raiffeisen Bank International and KBC Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Raiffeisen Bank International	0	1	0	1	3.00
KBC Group	1	3	1	1	2.33

Profitability

This table compares Raiffeisen Bank International and KBC Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Raiffeisen Bank International	10.91%	6.19%	0.65%
KBC Group	15.70%	13.89%	0.94%

Summary

KBC Group beats Raiffeisen Bank International on 10 of the 13 factors compared between the two stocks.

About Raiffeisen Bank International

Raiffeisen Bank International AG, together with its subsidiaries, offers banking services to corporate, private customers, and institutional customers. The company offers cash management, cross border accounts, electronic banking, payments solutions, sustainable and subsidized financing, leveraged and acquisition financing, project and structured financing, real estate financing, leasing, factoring, trade and export financing, investment banking, investing, hedging, and investor services to its institutional clients and corporate customers in agri food and beverage, automotive, construction and building materials, food and beverage, healthcare and pharmaceuticals, oil and gas, packaging, real estate, retail, technology, telecom, and utilities industries. It also provides retail and private banking services, including deposits, loans, wealth management, and advisory services to retail customers and small and medium-sized enterprises. In addition, the company offers clearing, reporting, settlement, guarantees, letters of credit, fund administration, acceptances, brokerage, asset management, and custody services; and investment banking services, including asset based finance, fund finance and alternatives investments, loan syndication, mergers and acquisitions advisory, and debt and equity capital markets services. It operates through a network of business outlets in Central, Southeastern, and Eastern Europe, as well as Austria, Czech Republic, Hungary, Poland, and Slovakia. Raiffeisen Bank International AG was founded in 1886 and is based in Vienna, Austria.

About KBC Group

KBC Group NV, together with its subsidiaries, provides integrated bank-insurance services primarily for retail, private banking, small and medium sized enterprises, and mid-cap clients. The company offers demand deposits and savings accounts; home and mortgage loans; consumer finance and SME funding services; credit, investment fund and asset management, and life and non-life insurance; and cash management, payments, trade finance, lease, money market, capital market products, and stockbroking services. It also provides digital and mobile banking services. The company was formerly known as KBC Bank and Insurance Holding Company NV and changed its name to KBC Group NV in March 2005. KBC Group NV was incorporated in 1935 and is headquartered in Brussels, Belgium.