Critical Analysis: Mitsubishi UFJ Financial Group (MTU) & Grupo Aval Acciones y Valores (AVAL)
Mitsubishi UFJ Financial Group (NYSE: MTU) and Grupo Aval Acciones y Valores (NYSE:AVAL) are both mid-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, analyst recommendations, dividends, valuation, risk, profitability and institutional ownership.
Volatility and Risk
Mitsubishi UFJ Financial Group has a beta of 1.63, indicating that its stock price is 63% more volatile than the S&P 500. Comparatively, Grupo Aval Acciones y Valores has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500.
Institutional & Insider Ownership
1.1% of Mitsubishi UFJ Financial Group shares are owned by institutional investors. Comparatively, 22.0% of Grupo Aval Acciones y Valores shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
This table compares Mitsubishi UFJ Financial Group and Grupo Aval Acciones y Valores’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Mitsubishi UFJ Financial Group||16.99%||6.59%||0.35%|
|Grupo Aval Acciones y Valores||8.23%||9.54%||1.04%|
Mitsubishi UFJ Financial Group pays an annual dividend of $0.08 per share and has a dividend yield of 1.3%. Grupo Aval Acciones y Valores pays an annual dividend of $0.43 per share and has a dividend yield of 4.8%. Mitsubishi UFJ Financial Group pays out 11.4% of its earnings in the form of a dividend. Grupo Aval Acciones y Valores pays out 66.2% 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.
Earnings & Valuation
This table compares Mitsubishi UFJ Financial Group and Grupo Aval Acciones y Valores’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Mitsubishi UFJ Financial Group||$29.91 billion||2.83||$9.30 billion||$0.70||9.09|
|Grupo Aval Acciones y Valores||$4.72 billion||2.11||$724.12 million||$0.65||13.77|
Mitsubishi UFJ Financial Group has higher revenue and earnings than Grupo Aval Acciones y Valores. Mitsubishi UFJ Financial Group is trading at a lower price-to-earnings ratio than Grupo Aval Acciones y Valores, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and price targets for Mitsubishi UFJ Financial Group and Grupo Aval Acciones y Valores, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Mitsubishi UFJ Financial Group||0||1||3||0||2.75|
|Grupo Aval Acciones y Valores||0||0||1||0||3.00|
Mitsubishi UFJ Financial Group beats Grupo Aval Acciones y Valores on 8 of the 14 factors compared between the two stocks.
About Mitsubishi UFJ Financial Group
Mitsubishi UFJ Financial Group, Inc. (MUFJ) is a bank holding company. The Company’s segments include Integrated Retail Banking Business Group, Integrated Corporate Banking Business Group, Integrated Trust Assets Business Group, Integrated Global Business Group and Krungsri. The Company’s services include commercial banking, trust banking, securities, credit cards, consumer finance, asset management, leasing and various fields of financial services. The Company’s subsidiaries include The Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU), Mitsubishi UFJ Trust and Banking Corporation (MUTB), Mitsubishi UFJ Securities Holdings Co., Ltd. (MUSHD), Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. (MUMSS) and Mitsubishi UFJ NICOS Co., Ltd. Its Retail Banking Business Group covers retail businesses, including commercial banking, trust banking and securities businesses, and offers a range of banking products and services, including financial consulting services, to retail customers in Japan.
About Grupo Aval Acciones y Valores
Grupo Aval Acciones y Valores SA is a Colombia-based holding company primarily engaged, through its subsidiaries, in the acquisition, purchase and sale of stocks, bonds and other securities of companies active in the financial sector. The Company provides a variety of financial services and products across the Colombian market, ranging from traditional banking services, such as loans and deposits to pension and severance fund management, as well as the provision of legal representation services.The Company owns such subsidiaries as Banco de Bogota SA, Banco Popular SA, among others. In April 2013, the Company acquired BBVA Horizonte Sociedad Administradora de Fondos de Pensiones y Cesantias SA from Banco Bilbao Vizcaya Argentaria SA. In December 2013, Banco Bilbao Vizcaya sold the entirety of its about 98.92% direct and indirect interest in Banco Bilbao Vizacaya Argentaria (Panama) SA (BBVA Panama) to Leasing Bogota SA, Panama, a subsidiary of the Company.
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