Shinhan Financial Group (NYSE:SHG) and Lloyds Banking Group (NYSE:LYG) Financial Comparison

Lloyds Banking Group (NYSE:LYG) and Shinhan Financial Group (NYSE:SHG) are both large-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, risk, valuation, dividends and profitability.

Volatility and Risk

Lloyds Banking Group has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500. Comparatively, Shinhan Financial Group has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Lloyds Banking Group and Shinhan Financial Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lloyds Banking Group	0	2	4	1	2.86
Shinhan Financial Group	0	0	0	0	0.00

Profitability

This table compares Lloyds Banking Group and Shinhan Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lloyds Banking Group	17.51%	9.28%	0.48%
Shinhan Financial Group	21.21%	12.33%	0.98%

Valuation & Earnings

This table compares Lloyds Banking Group and Shinhan Financial Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lloyds Banking Group	$43.81 billion	1.57	$5.65 billion	$0.40	11.46
Shinhan Financial Group	$24.56 billion	0.99	$3.12 billion	$9.98	5.00

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

Dividends

Lloyds Banking Group pays an annual dividend of $0.13 per share and has a dividend yield of 2.8%. Shinhan Financial Group pays an annual dividend of $1.29 per share and has a dividend yield of 2.6%. Lloyds Banking Group pays out 32.5% of its earnings in the form of a dividend. Shinhan Financial Group pays out 12.9% 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.

Insider and Institutional Ownership

2.2% of Lloyds Banking Group shares are owned by institutional investors. Comparatively, 7.8% of Shinhan Financial Group shares are owned by institutional investors. 0.0% of Lloyds Banking Group shares are owned by company insiders. Comparatively, 1.0% of Shinhan Financial Group shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Lloyds Banking Group beats Shinhan Financial Group on 9 of the 16 factors compared between the two stocks.

About Lloyds Banking Group

Lloyds Banking Group plc, together with its subsidiaries, provides a range of banking and financial services in the United Kingdom and internationally. It operates in three segments: Retail; Commercial Banking; and Insurance, Pensions and Investments. The Retail segment offers a range of financial service products, including current accounts, savings, mortgages, motor finance, unsecured loans, leasing solutions, and credit cards to personal customers. The Commercial Banking segment provides lending, transactional banking, working capital management, risk management, and debt financing services to small and medium-sized entities, corporates, and institutions. The Insurance, Pensions, and Investments segment offers insurance, investment, and pension management products and services. It also provides digital banking services. The company offers its products and services under the Lloyds Bank, Halifax, Bank of Scotland, Scottish Widows, MBNA, Schroders Personal Wealth, Black Horse, Lex Autolease, Birmingham Midshires, LDC, AMC, Embark Group, Citra, IWeb, Cavendish Online, and Tusker brand names. Lloyds Banking Group plc was founded in 1695 and is headquartered in London, the United Kingdom.

About Shinhan Financial Group

Shinhan Financial Group Co., Ltd. provides financial products and services in South Korea and internationally. The company operates through six segments: Banking, Credit Card, Securities, Insurance, Credit, and Others. It offers retail banking services, including demand, savings, and fixed deposit-taking; checking accounts; mortgage and home equity, and retail lending; electronic banking and automatic teller machines (ATM); and bill paying, payroll and check-cashing, currency exchange, and wire fund transfer services. The company also provides corporate banking services, such as investment banking, real estate financing, overseas real estate and development project financing, infrastructure and structured financing, equity/venture investments, mergers and acquisitions consulting; securitization and derivatives services comprising securities and derivative products, and foreign exchange trading; business expansion financing and consulting services; and working capital loans and facilities loans. In addition, it is involved in treasury and investment activities in international capital markets consisting of foreign currency-denominated securities trading, foreign exchange trading and services, trade-related financial services, international factoring services, and foreign banking operations. Further, the company offers real estate trust, investment advisory, venture business investment, life and non-life insurance, trust account management, securities brokerage, and asset management services, as well as leasing and equipment financing, savings banking, loan collection and credit reporting, collective investment administration, private equity investment, and financial system development services. Additionally, it provides transaction history inquiries and fund transfers, opening letters of credit, trade finance, payment and collection management, sales and acquisition settlement, business-to-business settlement, sweeping, pooling, ERP interface, host-to-host banking, SWIFT SCORE, and cash and liquidity management service. Shinhan Financial Group Co., Ltd. was founded in 1982 and is headquartered in Seoul, South Korea.