Critical Survey: Societe Generale Group (OTCMKTS:SCGLY) & Banco Santander Chile (NYSE:BSAC)

Banco Santander Chile (NYSE:BSAC) and Societe Generale Group (OTCMKTS:SCGLY) are both large-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, dividends, profitability, earnings, institutional ownership and valuation.

Profitability

This table compares Banco Santander Chile and Societe Generale Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Santander Chile	26.85%	23.55%	1.78%
Societe Generale Group	24.17%	7.57%	0.38%

Institutional and Insider Ownership

6.4% of Banco Santander Chile shares are owned by institutional investors. Comparatively, 1.0% of Societe Generale Group shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Banco Santander Chile and Societe Generale Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Santander Chile	$4.50 billion	3.42	$1.12 billion	$2.64	12.37
Societe Generale Group	$30.83 billion	1.79	$6.79 billion	$2.06	7.26

Societe Generale Group has higher revenue and earnings than Banco Santander Chile. Societe Generale Group 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.

Volatility & Risk

Banco Santander Chile has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Societe Generale Group has a beta of 0.82, suggesting that its stock price is 18% less volatile than the S&P 500.

Dividends

Banco Santander Chile pays an annual dividend of $1.10 per share and has a dividend yield of 3.4%. Societe Generale Group pays an annual dividend of $0.22 per share and has a dividend yield of 1.5%. Banco Santander Chile pays out 41.7% of its earnings in the form of a dividend. Societe Generale Group pays out 10.7% 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.

Analyst Recommendations

This is a summary of recent ratings for Banco Santander Chile and Societe Generale Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Santander Chile	1	4	3	1	2.44
Societe Generale Group	0	5	3	1	2.56

Banco Santander Chile currently has a consensus target price of $35.20, suggesting a potential upside of 7.78%. Given Banco Santander Chile’s higher probable upside, analysts clearly believe Banco Santander Chile is more favorable than Societe Generale Group.

Summary

Banco Santander Chile beats Societe Generale Group on 9 of the 14 factors compared between the two stocks.

About Banco Santander Chile

Banco Santander-Chile, together with its subsidiaries, provides commercial and retail banking services in Chile. It operates through Retail Banking, Middle-Market, Corporate Investment Banking, and Corporate Activities segments. The company offers debit and credit cards, checking accounts, and savings products; consumer, automobile, commercial, mortgage, and government-guaranteed loans; and Chilean peso and foreign currency-denominated loans to finance various commercial transactions, trade, foreign currency forward contracts, and credit lines, as well as mortgage financing services. It also provides mutual fund management, insurance and securities brokerage, foreign exchange services, financial leasing, financial consulting and advisory, investment management, foreign trade, leasing, factoring, treasury, and transactional services, as well as specialized services to finance residential projects. In addition, the company offers short-term financing and fundraising, and brokerage services, as well as derivatives, securitization, and other products; and manages capital allocations. 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 was incorporated in 1977 and is headquartered in Santiago, Chile. Banco Santander-Chile operates as a subsidiary of Banco Santander, S.A.

About Societe Generale Group

Société Générale Société anonyme provides banking and financial services to individuals, corporates, and institutional clients in Europe and internationally. It operates through French Retail Banking, International Retail Banking & Financial Services, and Global Banking and Investor Solutions. It offers retail banking services, such as consumer credit, vehicle leasing and fleet management, online banking, wealth management, and equipment and vendor finance services; and insurance products, including home, vehicle, family, health, and mortgage insurance. The company also provides corporate and investment banking, securities, business consulting, consumer finance, advisory and financing, and asset management and private banking services. In addition, it offers brokerage, cash management, payment, factoring/reverse factoring, export financing, trade finance, cash clearing and correspondent banking, and receivables and supply chain financing services. Société Générale Société anonyme was incorporated in 1864 and is headquartered in Paris, France.