Bank of Montreal (NYSE:BMO) and Intercorp Financial (NYSE:IFS) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, institutional ownership, earnings, profitability, valuation and risk.

Institutional and Insider Ownership

42.1% of Bank of Montreal shares are owned by institutional investors. 1.0% of Bank of Montreal shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Bank of Montreal pays an annual dividend of $3.13 per share and has a dividend yield of 4.1%. Intercorp Financial does not pay a dividend. Bank of Montreal pays out 44.8% of its earnings in the form of a dividend.

Profitability

This table compares Bank of Montreal and Intercorp Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bank of Montreal 16.48% 14.14% 0.76%
Intercorp Financial N/A N/A N/A

Analyst Ratings

This is a breakdown of current ratings and price targets for Bank of Montreal and Intercorp Financial, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bank of Montreal 1 9 1 0 2.00
Intercorp Financial 0 0 2 0 3.00

Bank of Montreal presently has a consensus target price of $101.00, indicating a potential upside of 33.49%. Intercorp Financial has a consensus target price of $56.50, indicating a potential upside of 40.20%. Given Intercorp Financial’s stronger consensus rating and higher probable upside, analysts clearly believe Intercorp Financial is more favorable than Bank of Montreal.

Valuation & Earnings

This table compares Bank of Montreal and Intercorp Financial’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Bank of Montreal $25.01 billion 1.93 $4.24 billion $6.99 10.82
Intercorp Financial $1.51 billion 3.05 $329.95 million N/A N/A

Bank of Montreal has higher revenue and earnings than Intercorp Financial.

Summary

Bank of Montreal beats Intercorp Financial on 8 of the 13 factors compared between the two stocks.

Bank of Montreal Company Profile

Bank of Montreal provides diversified financial services primarily in North America. It operates through three groups: Personal and Commercial Banking, Wealth Management, and BMO Capital Markets. The company's personal banking products and services include checking and savings accounts, credit cards, mortgages, and financial and investment advice services; and commercial banking products and services comprise business deposit accounts, commercial credit cards, business loans and commercial mortgages, cash management solutions, foreign exchange, and specialized banking programs for small business and commercial banking customers, as well as wealth management products and services, such as insurance products. It also offers equity and debt underwriting, corporate lending and project financing, mergers and acquisitions advisory services, securitization, treasury management, risk management, equity and fixed income research, and institutional sales and trading services to corporate, institutional, and government clients. In addition, the company offers trade finance, investment management, online investing, trust and estate services, tax planning, and investment solutions to institutional investors, as well as industry-leading research, sales, and trading services. It operates approximately 1,500 branches in Canada and the United States, as well as offices in 27 jurisdictions. The company was founded in 1817 and is headquartered in Montreal, Canada.

Intercorp Financial Company Profile

Intercorp Financial Services, Inc. is a holding company, which engages in the provision of financial services. Through its subsidiaries, it operates through the following business segments: Banking, Insurance, and Wealth Management. The Banking segment provides a range of retail banking and commercial banking products, and services to individuals, large companies, and small and medium enterprises. The Insurance segment offers retirement, savings, life, unemployment, and other insurance products mainly to retail customers. The Wealth Management segment comprises wealth management, private banking, financing, brokerage, advisory, and other investment services mainly to high net worth individuals. The company was founded on September 19, 2006 and is headquartered in Lima, Peru.

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