Head to Head Contrast: Mitsubishi UFJ Financial Group (NYSE:MUFG) versus Bank of Communications (OTCMKTS:BCMXY)

Mitsubishi UFJ Financial Group (NYSE:MUFG) and Bank of Communications (OTCMKTS:BCMXY) are both large-cap financial services companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, dividends, valuation and analyst recommendations.

Dividends

Mitsubishi UFJ Financial Group pays an annual dividend of $0.20 per share and has a dividend yield of 1.8%. Bank of Communications pays an annual dividend of $1.11 per share and has a dividend yield of 6.3%. Mitsubishi UFJ Financial Group pays out 23.0% of its earnings in the form of a dividend. Bank of Communications pays out 28.0% 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.

Profitability

This table compares Mitsubishi UFJ Financial Group and Bank of Communications’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mitsubishi UFJ Financial Group	11.73%	7.46%	0.38%
Bank of Communications	15.46%	7.62%	0.60%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Mitsubishi UFJ Financial Group and Bank of Communications, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mitsubishi UFJ Financial Group	0	0	0	0	N/A
Bank of Communications	0	0	0	0	N/A

Insider and Institutional Ownership

13.6% of Mitsubishi UFJ Financial Group shares are owned by institutional investors. 0.0% of Mitsubishi UFJ Financial Group shares are owned by company 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.

Earnings and Valuation

This table compares Mitsubishi UFJ Financial Group and Bank of Communications”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mitsubishi UFJ Financial Group	$6,224.87 billion	0.02	$10.29 billion	$0.87	12.46
Bank of Communications	$78.35 billion	0.67	$13.10 billion	$3.97	4.46

Bank of Communications has lower revenue, but higher earnings than Mitsubishi UFJ Financial Group. Bank of Communications 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.

Risk and Volatility

Mitsubishi UFJ Financial Group has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500. Comparatively, Bank of Communications has a beta of 0.03, indicating that its stock price is 97% less volatile than the S&P 500.

Summary

Bank of Communications beats Mitsubishi UFJ Financial Group on 7 of the 13 factors compared between the two stocks.

About Mitsubishi UFJ Financial Group

Mitsubishi UFJ Financial Group, Inc. operates as the bank holding company, that engages in a range of financial businesses in Japan, the United States, Europe, Asia/Oceania, and internationally. It operates through seven segments: Digital Service, Retail & Commercial Banking, Japanese Corporate & Investment Banking, Global Commercial Banking, Asset Management & Investor Services, Global Corporate & Investment Banking, and Global Markets. The company offers commercial banking, trust banking, and securities products and services to retail, and small and medium-sized enterprise customers. It also provides mergers and acquisition, debt and equity issuance, financial advice, and real estate-related services; digital-based financial services; credit cards; and trust banking and securities products and services, as well as engages in the lending, fund settlement, and foreign exchange businesses. In addition, the company offers corporate banking services, such as project export credit agency finance, and financing through asset-backed commercial paper; investment and transaction banking services for corporations, financial institutions, sovereign and multinational organizations, and institutional investors; and asset management and investor services, including pension fund management and administration, pension structure advisory, beneficiary payment, and investment trust services for retail customers. Further, it provides loans, deposits, fund transfers, hedging, and investments services for retail, small and medium-sized enterprise, as well as corporate customers; financing for automotive and consumer goods; sells and trades in fixed income instruments, currencies, equities, and equities; offers investment products comprising mutual funds, structured bonds, and notes; originates and distributes of financial products; and provides insurance and treasury services. The company was founded in 1880 and is headquartered in Tokyo, Japan.

About Bank of Communications

Bank of Communications Co., Ltd. provides commercial banking products and services in China. The company offers savings deposit products, including demand deposits, lump-sum deposits and withdrawal, time deposit of small savings for lump-sum withdrawal, interest withdrawal on principal deposited, time-demand deposit, call deposit, swap management, and education deposit; personal certificate of deposit; salary financing A; and foreign currency deposit. It also provides credit, quasi-credit, and debit cards; new housing and second-hand mortgage loans and unsecured personal loans; personal wealth management advisor services; and precious metal and commodity trading services. In addition, the company offers corporate structured deposit and corporate certificate of deposit; corporate cash management; industrial chain finance program comprising prepayment financing, inventory financing, accounts receivable financing and accounts payable financing; syndicated loans; corporation overdraft; investment banking services; and offshore banking services, such as repayment financing, inventory financing, accounts receivable financing and accounts payable financing, and forex currencies. Further, it provides bond account activation, bond distribution, and transaction services; related bond escrow and settlement, pledge registration, and principal and interest payment services; training and consulting services for cooperative banks; cross-border inter-bank payments system services; consignment sales of precious metal products; bond underwriting distribution; third party bond depository services; bank derivatives transfer; b-share transfer; bankfutures transfer; standard warehouse warrant pledged financing; institutional investment consulting, wealth management, and insurance services; and clearing and settlement services for future markets. The company was founded in 1908 and is headquartered in Shanghai, the People’s Republic of China.