The PNC Financial Services Group (NYSE:PNC) versus Stifel Financial (NYSE:SF) Critical Comparison

Stifel Financial (NYSE:SF) and The PNC Financial Services Group (NYSE:PNC) are both large-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, valuation, dividends, risk, profitability and institutional ownership.

Dividends

Stifel Financial pays an annual dividend of $1.84 per share and has a dividend yield of 1.6%. The PNC Financial Services Group pays an annual dividend of $6.80 per share and has a dividend yield of 3.1%. Stifel Financial pays out 31.3% of its earnings in the form of a dividend. The PNC Financial Services Group pays out 41.0% 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. Stifel Financial has increased its dividend for 9 consecutive years and The PNC Financial Services Group has increased its dividend for 14 consecutive years. The PNC Financial Services Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Stifel Financial and The PNC Financial Services Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stifel Financial	12.37%	15.80%	1.92%
The PNC Financial Services Group	20.40%	11.87%	1.23%

Earnings & Valuation

This table compares Stifel Financial and The PNC Financial Services Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stifel Financial	$5.53 billion	2.07	$683.78 million	$5.88	19.08
The PNC Financial Services Group	$34.00 billion	2.54	$6.94 billion	$16.59	13.29

The PNC Financial Services Group has higher revenue and earnings than Stifel Financial. The PNC Financial Services Group is trading at a lower price-to-earnings ratio than Stifel Financial, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Stifel Financial has a beta of 1.13, meaning that its share price is 13% more volatile than the S&P 500. Comparatively, The PNC Financial Services Group has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Stifel Financial and The PNC Financial Services Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stifel Financial	0	6	5	0	2.45
The PNC Financial Services Group	1	5	15	0	2.67

Stifel Financial presently has a consensus price target of $135.20, indicating a potential upside of 20.53%. The PNC Financial Services Group has a consensus price target of $234.44, indicating a potential upside of 6.35%. Given Stifel Financial’s higher possible upside, equities analysts plainly believe Stifel Financial is more favorable than The PNC Financial Services Group.

Institutional & Insider Ownership

82.0% of Stifel Financial shares are held by institutional investors. Comparatively, 83.5% of The PNC Financial Services Group shares are held by institutional investors. 4.6% of Stifel Financial shares are held by company insiders. Comparatively, 0.4% of The PNC Financial Services Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

The PNC Financial Services Group beats Stifel Financial on 10 of the 17 factors compared between the two stocks.

About Stifel Financial

Stifel Financial Corp., a financial services and bank holding company, provides retail and institutional wealth management, and investment banking services to individual investors, corporations, municipalities, and institutions in the United States and internationally. It operates in three segments: Global Wealth Management, Institutional Group, and Other. The company provides private client services, including securities transaction and financial planning services; institutional equity and fixed income sales, trading and research, and municipal finance services; investment banking services, such as mergers and acquisitions, public offerings, and private placements; and retail and commercial banking services comprising personal and commercial lending programs, as well as deposit accounts. It participates in and manages underwritings for corporate and public finance; and offers financial advisory and securities brokerage services. The company was founded in 1890 and is headquartered in Saint Louis, Missouri.

About The PNC Financial Services Group

The PNC Financial Services Group, Inc. operates as a diversified financial services company in the United States. It operates through three segments: Retail Banking, Corporate & Institutional Banking, and Asset Management Group segments. The company's Retail Banking segment offers checking, savings, and money market accounts, as well as time deposit; residential mortgages, home equity loans and lines of credit, auto loans, credit cards, education loans, and personal and small business loans and lines of credit; and brokerage, insurance, and investment and cash management services. This segment serves consumer and small business customers through a network of branches, digital channels, ATMs, and through phone-based customer contact centers. Its Corporate & Institutional Banking segment provides secured and unsecured loans, letters of credit, and equipment leases; cash and investment management services, receivables and disbursement management services, funds transfer services, international payment services, and access to online/mobile information management and reporting; securities underwriting, loan syndications, customer-related trading, and mergers and acquisitions and equity capital markets advisory related services; and commercial loan servicing and technology solutions. It serves mid-sized and large corporations, and government and not-for-profit entities. The company's Asset Management Group segment offers investment and retirement planning, customized investment management, credit and cash management solutions, and trust management and administration services for high net worth and ultra high net worth individuals, and their families; and multi-generational family planning services for ultra high net worth individuals and their families. It also provides outsourced chief investment officer, custody, private real estate, cash and fixed income client solutions, and retirement plan fiduciary investment services for institutional clients. The company was founded in 1852 and is headquartered in Pittsburgh, Pennsylvania.