Banco Bilbao Vizcaya Argentaria (NYSE: BBVA) and Washington Federal (NASDAQ:WAFD) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, earnings, valuation, profitability, dividends, institutional ownership and analyst recommendations.

Valuation and Earnings

This table compares Banco Bilbao Vizcaya Argentaria and Washington Federal’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Banco Bilbao Vizcaya Argentaria $28.55 billion 2.02 $3.98 billion $0.55 16.00
Washington Federal $601.13 million 5.13 $173.53 million $2.07 17.32

Banco Bilbao Vizcaya Argentaria has higher revenue and earnings than Washington Federal. Banco Bilbao Vizcaya Argentaria is trading at a lower price-to-earnings ratio than Washington Federal, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Banco Bilbao Vizcaya Argentaria and Washington Federal’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Banco Bilbao Vizcaya Argentaria 13.74% 8.63% 0.67%
Washington Federal 30.20% 9.14% 1.21%

Institutional & Insider Ownership

3.2% of Banco Bilbao Vizcaya Argentaria shares are held by institutional investors. Comparatively, 83.1% of Washington Federal shares are held by institutional investors. 1.1% of Washington Federal shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

Banco Bilbao Vizcaya Argentaria has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.Comparatively, Washington Federal has a beta of 1.14, suggesting that its share price is 14% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Banco Bilbao Vizcaya Argentaria and Washington Federal, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Banco Bilbao Vizcaya Argentaria 1 1 2 0 2.25
Washington Federal 0 4 0 0 2.00

Washington Federal has a consensus target price of $36.75, suggesting a potential upside of 2.51%. Given Washington Federal’s higher probable upside, analysts plainly believe Washington Federal is more favorable than Banco Bilbao Vizcaya Argentaria.

Dividends

Banco Bilbao Vizcaya Argentaria pays an annual dividend of $0.34 per share and has a dividend yield of 3.9%. Washington Federal pays an annual dividend of $0.68 per share and has a dividend yield of 1.9%. Banco Bilbao Vizcaya Argentaria pays out 61.8% of its earnings in the form of a dividend. Washington Federal pays out 32.9% 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. Banco Bilbao Vizcaya Argentaria has increased its dividend for 6 consecutive years. Banco Bilbao Vizcaya Argentaria is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Washington Federal beats Banco Bilbao Vizcaya Argentaria on 11 of the 17 factors compared between the two stocks.

Banco Bilbao Vizcaya Argentaria Company Profile

Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) is a diversified financial company engaged in retail banking, wholesale banking, asset management and private banking. Its segments include Banking Activity in Spain, Real Estate Activity in Spain, the United States Turkey, Mexico, South America and Rest of Eurasia. Its Banking Activity in Spain segment includes Retail Network in Spain, Corporate and Business Banking (CBB), and BBVA Seguros and Asset Management units in Spain. Its Real Estate Activity in Spain segment covers specialist management of real-estate assets in the country. In the United States it offers services through, BBVA Compass Bancshares Inc. and the BBVA New York branch. The Turkey segment represents its stake in the Turkish bank, Turkiye Garanti Bankasi A.S. It offers banking and insurance businesses in Mexico. In South America, it provides banking and insurance businesses. The Rest of Eurasia segment includes business activity in the rest of Europe and Asia.

Washington Federal Company Profile

Washington Federal, Inc. is a bank holding company. The Company conducts its operations through a federally insured national bank subsidiary, Washington Federal, National Association (the Bank). The business of the Bank consists primarily of accepting deposits from the general public and investing these funds in loans of various types, including first lien mortgages on single-family dwellings, construction loans, land acquisition and development loans, loans on multi-family, commercial real estate and other income producing properties, home equity loans and business loans. As of September 30, 2016, Washington Federal had 238 branches located in Washington, Oregon, Idaho, Arizona, Utah, Nevada, New Mexico and Texas. Through its subsidiaries, the Company is also engaged in real estate investment and insurance brokerage activities. The Bank offers various consumer checking account products, both interest bearing and non-interest bearing, and business checking accounts.

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