Analyzing Oversea-Chinese Banking (OTCMKTS:OVCHY) & Bank of Nova Scotia (NYSE:BNS)

Bank of Nova Scotia (NYSE:BNS) and Oversea-Chinese Banking (OTCMKTS:OVCHY) are both large-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, institutional ownership, valuation and risk.

Institutional & Insider Ownership

49.1% of Bank of Nova Scotia shares are held by institutional investors. Comparatively, 0.0% of Oversea-Chinese Banking shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Bank of Nova Scotia and Oversea-Chinese Banking’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank of Nova Scotia	13.38%	13.16%	0.70%
Oversea-Chinese Banking	N/A	N/A	N/A

Risk and Volatility

Bank of Nova Scotia has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500. Comparatively, Oversea-Chinese Banking has a beta of 0.36, indicating that its share price is 64% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations for Bank of Nova Scotia and Oversea-Chinese Banking, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank of Nova Scotia	0	3	2	0	2.40
Oversea-Chinese Banking	0	1	0	0	2.00

Bank of Nova Scotia presently has a consensus price target of $117.00, suggesting a potential upside of 34.65%. Given Bank of Nova Scotia’s stronger consensus rating and higher possible upside, equities analysts clearly believe Bank of Nova Scotia is more favorable than Oversea-Chinese Banking.

Dividends

Bank of Nova Scotia pays an annual dividend of $3.21 per share and has a dividend yield of 3.7%. Oversea-Chinese Banking pays an annual dividend of $1.18 per share and has a dividend yield of 2.6%. Bank of Nova Scotia pays out 61.3% of its earnings in the form of a dividend. Bank of Nova Scotia has increased its dividend for 14 consecutive years. Bank of Nova Scotia is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Bank of Nova Scotia and Oversea-Chinese Banking”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank of Nova Scotia	$52.70 billion	2.02	$5.56 billion	$5.24	16.58
Oversea-Chinese Banking	$19.55 billion	5.20	$5.68 billion	N/A	N/A

Oversea-Chinese Banking has lower revenue, but higher earnings than Bank of Nova Scotia.

Summary

Bank of Nova Scotia beats Oversea-Chinese Banking on 11 of the 14 factors compared between the two stocks.

About Bank of Nova Scotia

The Bank of Nova Scotia provides various banking products and services in Canada, the United States, Mexico, Peru, Chile, Colombia, the Caribbean and Central America, and internationally. It operates through Canadian Banking, International Banking, Global Wealth Management, and Global Banking and Markets segments. The company offers financial advice and solutions, and banking products, including debit and credit cards, chequing and saving accounts, investments, mortgages, loans, and insurance to individuals; and retail automotive financing solutions. It also provides business banking solutions comprising lending, deposit, cash management, and trade finance solutions to small, medium, and large businesses. In addition, it provides wealth management advice and solutions, including online brokerage, mobile investment, full-service brokerage, trust, private banking, and private investment counsel services; and retail mutual funds, exchange traded funds, liquid alternatives, and institutional funds. The Bank of Nova Scotia was founded in 1832 and is headquartered in Toronto, Canada.

About Oversea-Chinese Banking

Oversea-Chinese Banking Corporation Limited engages in the provision of financial services in Singapore, Malaysia, Indonesia, Greater China, rest of the Asia Pacific, and internationally. The company's Global Consumer/Private Banking segment provides products and services to individual customers, including checking accounts, and savings and fixed deposits; housing and other personal loans; credit cards; wealth management products consisting of unit trusts, banc assurance products, and structured deposits; and brokerage services. This segment also offers investment advice and portfolio management, estate and trust planning, and wealth structuring services for high-net-worth individuals. Its Global Wholesale Banking segment provides long-term project financing, short-term credit, working capital, and trade financing; customized and structured equity-linked financing products; cash management and custodian services; capital market solutions; corporate finance and advisory banking services; and treasury products. This segment serves corporates, public sector, and small and medium enterprises. The company's Global Markets segment is involved in the foreign exchange activities, money market operations, and fixed income and derivatives trading, as well as structured treasury products and financial solutions. Its Insurance segment provides fund management services, and life and general insurance products. The company's Others segment is involved in property and investment holding activities. Oversea-Chinese Banking Corporation Limited was founded in 1912 and is headquartered in Singapore.