Mitsubishi UFJ Financial Group (NYSE:MUFG) vs. NatWest Group (NYSE:NWG) Critical Survey

NatWest Group (NYSE:NWG) and Mitsubishi UFJ Financial Group (NYSE:MUFG) are both large-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, risk, dividends and earnings.

Volatility & Risk

NatWest Group has a beta of 1.02, indicating that its share price is 2% more volatile than the S&P 500. Comparatively, Mitsubishi UFJ Financial Group has a beta of 0.51, indicating that its share price is 49% less volatile than the S&P 500.

Insider and Institutional Ownership

1.3% of NatWest Group shares are owned by institutional investors. Comparatively, 13.6% of Mitsubishi UFJ Financial Group shares are owned by institutional investors. 0.0% of Mitsubishi UFJ Financial Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

NatWest Group pays an annual dividend of $0.63 per share and has a dividend yield of 4.0%. Mitsubishi UFJ Financial Group pays an annual dividend of $0.51 per share and has a dividend yield of 2.3%. NatWest Group pays out 31.5% of its earnings in the form of a dividend. Mitsubishi UFJ Financial Group pays out 33.3% 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. NatWest Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares NatWest Group and Mitsubishi UFJ Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NatWest Group	19.61%	13.75%	0.80%
Mitsubishi UFJ Financial Group	17.63%	12.30%	0.66%

Analyst Recommendations

This is a summary of current ratings and recommmendations for NatWest Group and Mitsubishi UFJ Financial Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NatWest Group	1	2	6	1	2.70
Mitsubishi UFJ Financial Group	0	1	3	1	3.00

Earnings and Valuation

This table compares NatWest Group and Mitsubishi UFJ Financial Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NatWest Group	$38.91 billion	1.61	$7.69 billion	$2.00	7.88
Mitsubishi UFJ Financial Group	$97.13 billion	2.67	$11.41 billion	$1.53	14.26

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

Summary

NatWest Group beats Mitsubishi UFJ Financial Group on 8 of the 15 factors compared between the two stocks.

About NatWest Group

NatWest Group plc is a UK banking and financial services group headquartered in Edinburgh, Scotland. Formerly known as The Royal Bank of Scotland Group, it adopted the NatWest Group name in 2020. Its principal brands include NatWest, the Royal Bank of Scotland, Ulster Bank and Coutts. The group serves personal, business and institutional customers. Its services include current and savings accounts, mortgages, personal lending, business finance, payment services, private banking and wealth management.

About Mitsubishi UFJ Financial Group

Mitsubishi UFJ Financial Group, Inc. (NYSE: MUFG) is a Japan-based financial services group headquartered in Tokyo. It was formed in 2005 through the merger of Mitsubishi Tokyo Financial Group and UFJ Holdings. MUFG provides commercial and retail banking, trust banking, securities, credit card and consumer finance, asset management, and leasing services. Its businesses serve individuals, companies, and institutional clients. The group operates primarily in Japan and also serves customers through a broad international network across the Americas, Europe, and Asia-Pacific.