Reviewing Banco Santander-Chile (BSAC) and Banco Bilbao Vizcaya Argentaria (BBVA)

Banco Santander-Chile (NYSE: BSAC) and Banco Bilbao Vizcaya Argentaria (NYSE:BBVA) are both large-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, profitability, dividends, institutional ownership, valuation, earnings and analyst recommendations.

Analyst Recommendations

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This is a breakdown of recent ratings and price targets for Banco Santander-Chile and Banco Bilbao Vizcaya Argentaria, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Santander-Chile	2	2	0	0	1.50
Banco Bilbao Vizcaya Argentaria	0	2	2	0	2.50

Banco Santander-Chile presently has a consensus target price of $29.50, indicating a potential downside of 6.68%. Banco Bilbao Vizcaya Argentaria has a consensus target price of $7.79, indicating a potential upside of 4.85%. Given Banco Bilbao Vizcaya Argentaria’s stronger consensus rating and higher possible upside, analysts clearly believe Banco Bilbao Vizcaya Argentaria is more favorable than Banco Santander-Chile.

Profitability

This table compares Banco Santander-Chile and Banco Bilbao Vizcaya Argentaria’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Santander-Chile	22.58%	18.75%	1.62%
Banco Bilbao Vizcaya Argentaria	12.30%	6.50%	0.50%

Insider & Institutional Ownership

15.5% of Banco Santander-Chile shares are held by institutional investors. Comparatively, 3.1% of Banco Bilbao Vizcaya Argentaria shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Banco Santander-Chile and Banco Bilbao Vizcaya Argentaria’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Santander-Chile	$4.14 billion	3.60	$844.20 million	$1.94	16.29
Banco Bilbao Vizcaya Argentaria	$28.55 billion	1.71	$3.98 billion	$0.73	10.18

Banco Bilbao Vizcaya Argentaria has higher revenue and earnings than Banco Santander-Chile. Banco Bilbao Vizcaya Argentaria is trading at a lower price-to-earnings ratio than Banco Santander-Chile, indicating that it is currently the more affordable of the two stocks.

Dividends

Banco Santander-Chile pays an annual dividend of $1.12 per share and has a dividend yield of 3.5%. Banco Bilbao Vizcaya Argentaria pays an annual dividend of $0.30 per share and has a dividend yield of 4.0%. Banco Santander-Chile pays out 57.7% of its earnings in the form of a dividend. Banco Bilbao Vizcaya Argentaria pays out 41.1% 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 Bilbao Vizcaya Argentaria has raised its dividend for 6 consecutive years. Banco Bilbao Vizcaya Argentaria is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Banco Santander-Chile has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500. Comparatively, Banco Bilbao Vizcaya Argentaria has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500.

Summary

Banco Bilbao Vizcaya Argentaria beats Banco Santander-Chile on 9 of the 16 factors compared between the two stocks.

Banco Santander-Chile Company Profile

Banco Santander-Chile provides commercial and retail banking products and services in Chile. It operates through Retail Banking, Middle-Market, and Global Corporate Banking segments. The company offers checking accounts and savings products; consumer, auto, commercial, mortgage, and government-guaranteed loans; credit and debit cards; and Chilean peso and foreign currency denominated loans to finance various commercial transactions, trade, foreign currency forward contracts, and credit lines. It also provides mutual funds, insurance and stock brokerage, foreign exchange, leasing, factoring, financial consulting, investment management, foreign trade and mortgage financing, treasury, and transactional services, as well as specialized services to finance projects for the real estate industry. In addition, the company offers short-term financing and fund raising, brokerage services, derivatives, securitization, and other tailor-made products. It serves individuals, small to middle-sized entities, companies, and large corporations, as well as universities, government entities, and local and regional governments. The company operates 385 branches, which include 276 under the Santander brand name, 51 under the Select brand name, 7 specialized branches for the middle market, and 31 as auxiliary and payment centers, as well as 926 ATMs. Banco Santander-Chile was founded in 1977 and is headquartered in Santiago, Chile.

Banco Bilbao Vizcaya Argentaria Company Profile

Banco Bilbao Vizcaya Argentaria, S.A., together with its subsidiaries, provides retail and wholesale banking, asset management, and private banking services. The company accepts various deposits, such as current and savings accounts, fixed-term deposits, subordinated deposits, and other accounts. It also offers loan products; and foreclosed real-estate assets from residential mortgages and developers, as well as lending to developers. The company also offers credit cards; and corporate and business banking, corporate and investment banking, and insurance. It operates in Spain, Mexico, South America, the United States, Turkey, Asia-Pacific, and rest of Europe. Banco Bilbao Vizcaya Argentaria, S.A. was founded in 1857 and is headquartered in Madrid, Spain.