Analyzing ICICI Bank (NYSE:IBN) and Banco Bradesco (NYSE:BBD)

Banco Bradesco (NYSE:BBD) and ICICI Bank (NYSE:IBN) are both large-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations and price targets for Banco Bradesco and ICICI Bank, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Bradesco	1	0	4	0	2.60
ICICI Bank	0	1	0	0	2.00

Banco Bradesco currently has a consensus price target of $2.40, indicating a potential downside of 34.16%. Given Banco Bradesco’s stronger consensus rating and higher probable upside, research analysts clearly believe Banco Bradesco is more favorable than ICICI Bank.

Dividends

Banco Bradesco pays an annual dividend of $0.02 per share and has a dividend yield of 0.5%. ICICI Bank pays an annual dividend of $0.21 per share and has a dividend yield of 0.7%. Banco Bradesco pays out 5.7% of its earnings in the form of a dividend. ICICI Bank pays out 13.0% 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.

Valuation and Earnings

This table compares Banco Bradesco and ICICI Bank”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Bradesco	$117.80 billion	0.33	$3.20 billion	$0.35	10.41
ICICI Bank	$2,134.65 billion	0.05	$6.02 billion	$1.62	18.95

ICICI Bank has higher revenue and earnings than Banco Bradesco. Banco Bradesco is trading at a lower price-to-earnings ratio than ICICI Bank, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

18.2% of ICICI Bank shares are owned by institutional investors. 0.3% of Banco Bradesco shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Banco Bradesco and ICICI Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Bradesco	9.61%	12.95%	1.06%
ICICI Bank	24.91%	14.91%	1.89%

Volatility & Risk

Banco Bradesco has a beta of 0.57, meaning that its stock price is 43% less volatile than the S&P 500. Comparatively, ICICI Bank has a beta of 0.42, meaning that its stock price is 58% less volatile than the S&P 500.

Summary

ICICI Bank beats Banco Bradesco on 9 of the 16 factors compared between the two stocks.

About Banco Bradesco

Banco Bradesco S.A., together with its subsidiaries, provides various banking products and services to individuals, corporates, and businesses in Brazil and internationally. The company operates through two segments, Banking and Insurance. It provides current, savings, click, and salary accounts; real estate credit, vehicle financing, payroll loans, mortgage loans, microcredit, leasing, and personal and installment credit; overdraft and agribusiness loans; debit and business cards; financial and security services; consortium products; car, personal accident, dental, travel, and life insurance; investment products; pension products; foreign currency exchange services; capitalization bonds; and internet banking services. Banco Bradesco S.A. was founded in 1943 and is headquartered in Osasco, Brazil.

About ICICI Bank

ICICI Bank Limited provides various banking products and services in India and internationally. It operates through Retail Banking, Wholesale Banking, Treasury, Other Banking, Life Insurance, and Others segments. The company offers savings, salary, pension, current, and other accounts; and time, fixed, recurring, and security deposits services. It also provides home, car, two-wheeler, personal, gold, and commercial business loans, as well as loans against securities and other loans; business loans, including working capital finance, term loans, collateral free loans, loans without financials, finance for importers and exporters, and overdraft facilities, as well as loans for new entities and card swipes; and credit, debit, prepaid, travel, forex, and corporate cards. In addition, the company offers pockets wallet; fixed income products; investment products, such as mutual funds, gold monetization schemes, initial public offerings, and other online investment services; and agri and rural business, farmer finance, tractor loans, and micro banking services, as well as other services to agri corporates. Further, it provides portfolio management, trade, foreign exchange, locker, private and NRI banking, and cash management services; family wealth and demat accounts; commercial and investment banking, capital market, custodial, and institutional banking services; health, personal accident, fire, and motor insurance, as well as distributes general and life insurance products; and Internet, mobile, and phone banking services. Additionally, the company offers securities investment, broking, trading, and underwriting services; and merchant banking, trusteeship, housing finance, pension fund management, asset management, investment advisory, points of presence, and private equity/venture capital fund management services. ICICI Bank Limited was founded in 1955 and is headquartered in Mumbai, India.