Nordea Bank Abp (OTCMKTS:NRDBY – Get Rating) and Banco Santander (NYSE:SAN – Get Rating) are both large-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, risk, profitability and dividends.
Valuation and Earnings
This table compares Nordea Bank Abp and Banco Santander’s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Nordea Bank Abp | $13.79 billion | 2.86 | $3.77 billion | $0.99 | 10.93 |
| Banco Santander | $54.92 billion | 1.16 | $10.12 billion | $0.58 | 6.55 |
Banco Santander has higher revenue and earnings than Nordea Bank Abp. Banco Santander is trading at a lower price-to-earnings ratio than Nordea Bank Abp, indicating that it is currently the more affordable of the two stocks.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Nordea Bank Abp | 28.34% | 13.41% | 0.67% |
| Banco Santander | 18.47% | 9.77% | 0.56% |
Dividends
Nordea Bank Abp pays an annual dividend of $0.71 per share and has a dividend yield of 6.6%. Banco Santander pays an annual dividend of $0.08 per share and has a dividend yield of 2.1%. Nordea Bank Abp pays out 71.7% of its earnings in the form of a dividend. Banco Santander pays out 13.8% 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 Santander has raised its dividend for 1 consecutive years.
Analyst Recommendations
This is a summary of current recommendations and price targets for Nordea Bank Abp and Banco Santander, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Nordea Bank Abp | 0 | 4 | 2 | 0 | 2.33 |
| Banco Santander | 0 | 3 | 3 | 0 | 2.50 |
Nordea Bank Abp presently has a consensus target price of $10.58, suggesting a potential downside of 2.26%. Banco Santander has a consensus target price of $3.76, suggesting a potential downside of 1.13%. Given Banco Santander’s stronger consensus rating and higher possible upside, analysts clearly believe Banco Santander is more favorable than Nordea Bank Abp.
Risk & Volatility
Nordea Bank Abp has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500. Comparatively, Banco Santander has a beta of 1.08, meaning that its stock price is 8% more volatile than the S&P 500.
Insider and Institutional Ownership
1.9% of Banco Santander shares are held by institutional investors. 9.5% of Banco Santander shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Summary
Banco Santander beats Nordea Bank Abp on 10 of the 17 factors compared between the two stocks.
About Nordea Bank Abp
Nordea Bank Abp engages in the provision of banking and financial services. It operates through the following segments: Personal Banking, Business Banking, Large Corporates and Institutions, and Asset and Wealth Management. The Personal Banking segment offers the household customers financial services and solutions through internet and mobile bank, over the phone, online meetings, and branch offices. The Business Banking segment serves, advises, and partners with corporate customers, and provides payments, cash management, cards, working capital management, and finance solutions. The Large Corporates and Institution pertains to the provision of financial solutions to large Nordic and international corporate and institutional customers. The Asset and Wealth Management segment is composed of investment, savings, and risk management solutions for individuals and institutional investors. The company was founded in 1820 and is headquartered in Helsinki, Finland.
About Banco Santander
Banco Santander SA is a banking services company, which engages in the provision of banking services to individuals, companies, and institutions. It operates through the following segments: Europe, North America, South America, and Digital Consumer Bank. The Europe segment comprises business activities carried out in the region. The North America segment includes business activities in Mexico and the United States. The South America segment involves financial activities of the Group through its banks and subsidiary banks in the region. The Digital Consumer Bank segment includes Santander Consumer Finance, which incorporates the entire consumer finance business in Europe, Openbank, and ODS. The company was founded on March 21, 1857 and is headquartered in Madrid, Spain.
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