Head-To-Head Review: Royal Bank of Canada (NYSE:RY) and The Competition

Royal Bank of Canada (NYSE: RY) is one of 310 public companies in the “Banks” industry, but how does it compare to its competitors? We will compare Royal Bank of Canada to similar companies based on the strength of its analyst recommendations, institutional ownership, valuation, earnings, risk, profitability and dividends.

Valuation and Earnings

This table compares Royal Bank of Canada and its competitors top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Royal Bank of Canada $40.37 billion $8.74 billion 13.81
Royal Bank of Canada Competitors $5.50 billion $827.87 million 383.41

Royal Bank of Canada has higher revenue and earnings than its competitors. Royal Bank of Canada is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Royal Bank of Canada and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Royal Bank of Canada 1 6 1 0 2.00
Royal Bank of Canada Competitors 2259 8691 8714 359 2.36

Royal Bank of Canada presently has a consensus price target of $100.50, suggesting a potential upside of 20.07%. As a group, “Banks” companies have a potential downside of 8.87%. Given Royal Bank of Canada’s higher probable upside, equities analysts clearly believe Royal Bank of Canada is more favorable than its competitors.

Risk & Volatility

Royal Bank of Canada has a beta of 1.07, indicating that its stock price is 7% more volatile than the S&P 500. Comparatively, Royal Bank of Canada’s competitors have a beta of 0.78, indicating that their average stock price is 22% less volatile than the S&P 500.

Dividends

Royal Bank of Canada pays an annual dividend of $2.87 per share and has a dividend yield of 3.4%. Royal Bank of Canada pays out 47.4% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 1.9% and pay out 34.9% of their earnings in the form of a dividend.

Profitability

This table compares Royal Bank of Canada and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Royal Bank of Canada 22.62% 17.01% 0.95%
Royal Bank of Canada Competitors 18.61% 8.21% 0.93%

Institutional and Insider Ownership

40.6% of Royal Bank of Canada shares are held by institutional investors. Comparatively, 52.0% of shares of all “Banks” companies are held by institutional investors. 10.4% of shares of all “Banks” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Royal Bank of Canada beats its competitors on 8 of the 15 factors compared.

About Royal Bank of Canada

Royal Bank of Canada (RBC), is a diversified financial services company. The Company provides personal and commercial banking, wealth management services, insurance, investor services and capital markets products and services on a global basis. The Company serves personal, business, public sector and institutional clients in Canada, the United States and approximately 40 other countries. The Company’s business segments include Personal and Commercial Banking, Wealth Management, Insurance, Investor and Treasury Services, Capital Markets. The Company, through its segments, serves various lines of businesses, which include Personal Financial Services, Business Financial Services, Cards and Payment Solutions (Canadian Banking), Caribbean and United States Banking, Canadian Wealth Management, United States and International Wealth Management, Global Asset Management, Canadian Insurance, International Insurance, Corporate and Investment Banking, Global Markets and Other.

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