Comparing China Construction Bank (OTCMKTS:CICHY) & Mizuho Financial Group (NYSE:MFG)

Mizuho Financial Group (NYSE:MFG) and China Construction Bank (OTCMKTS:CICHY) are both large-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, earnings, profitability, institutional ownership, valuation and analyst recommendations.

Analyst Recommendations

This is a summary of current recommendations and price targets for Mizuho Financial Group and China Construction Bank, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mizuho Financial Group	0	1	1	0	2.50
China Construction Bank	0	1	0	0	2.00

Profitability

This table compares Mizuho Financial Group and China Construction Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mizuho Financial Group	12.31%	9.23%	0.35%
China Construction Bank	25.63%	9.81%	0.78%

Risk & Volatility

Mizuho Financial Group has a beta of 0.37, suggesting that its stock price is 63% less volatile than the S&P 500. Comparatively, China Construction Bank has a beta of 0.13, suggesting that its stock price is 87% less volatile than the S&P 500.

Dividends

Mizuho Financial Group pays an annual dividend of $0.15 per share and has a dividend yield of 1.7%. China Construction Bank pays an annual dividend of $0.80 per share and has a dividend yield of 4.0%. Mizuho Financial Group pays out 26.3% of its earnings in the form of a dividend. China Construction Bank pays out 22.2% 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. China Construction Bank is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

3.3% of Mizuho Financial Group shares are held by institutional investors. 0.0% of Mizuho Financial Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Mizuho Financial Group and China Construction Bank”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mizuho Financial Group	$59.30 billion	1.88	$3.92 billion	$0.57	15.76
China Construction Bank	$188.88 billion	1.39	$46.68 billion	$3.60	5.58

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

Summary

China Construction Bank beats Mizuho Financial Group on 8 of the 15 factors compared between the two stocks.

About Mizuho Financial Group

Mizuho Financial Group, Inc., together with its subsidiaries, engages in banking, trust, securities, and other businesses related to financial services in Japan, the Americas, Europe, Asia/Oceania, and internationally. It operates through Retail & Business Banking Company, Corporate & Institutional Company, Global Corporate Company, Global Markets Company, Asset Management Company, and Others segments. The company provides deposit products; syndicated, housing, and card loans; business matching services; and advisory services related to overseas expansions, and mergers and acquisitions-related services. It also offers consulting services, including asset management and asset succession; payroll services; and sells lottery tickets issued by prefectures and ordinance-designated cities. In addition, it offers fund management, underwriting of equity and bonds, risk hedging products, etc. for corporate customers; solutions based on capital management, business strategy, and financial strategy; real estate services; advisory services and solutions, such as advice on proposals on various investment products to financial institutions; and financial services that include funding support and public bonds underwriting. Further, the company offers corporate finance and transaction banking srvices; sales and trading services; investment products; pension funds; and ALM and investment services, including stable capital raising and balance sheet management, as well as management of fixed income, equity, and other securities portfolios. Additionally, the company provides online banking, cash management solutions, currency transaction, trade finance, custody, yen correspondence settlement, and research and consulting services; trust, securitization and structured finance, and stock transfers; and private banking and information technology-related services. Mizuho Financial Group, Inc. was founded in 2000 and is headquartered in Tokyo, Japan.

About China Construction Bank

China Construction Bank Corporation provides various banking and related financial services to individuals and corporate customers in the People's Republic of China and internationally. It operates through Corporate Finance Business, Personal Finance Business, Treasury and Asset Management Business, and Others segments. The company accepts various deposits, such as foreign currency, all in one accounts, RMB, corporate term and notification, and corporate demand deposits, as well corporate deposits by agreement. Its loan products include personal business, car, and housing loans; and SME, traditional credit, commercial draft, buyer credit, and RMB credit line loans. The company also offers credit cards; physical gold for personal investment and personal gold accounts; foreign exchange services; certificate treasury and savings bonds, securities deposit accounts, and securities services, as well as bank-securities transfer and book-entry treasury bond over the counter transaction services; and wealth management products. In addition, it provides collection, salaries payment, third-party collection and payment, insurance agency, and remittance services; international settlement and financing, and FI services; securities and fund settlement services; guarantee-based, consulting and advising, and factoring services; fund custody services; and e-banking services. Further, the company offers institutional services comprising services for government agencies, social security, banks cooperation, bank-securities cooperation, bank-insurance cooperation, and services for non-banking financial institutions. China Construction Bank Corporation was founded in 1954 and is headquartered in Beijing, the People's Republic of China.