Analyzing International Bancshares (NASDAQ:IBOC) and The PNC Financial Services Group (NYSE:PNC)

The PNC Financial Services Group (NYSE:PNC) and International Bancshares (NASDAQ:IBOC) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, dividends, risk and profitability.

Analyst Recommendations

This is a breakdown of current recommendations for The PNC Financial Services Group and International Bancshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
The PNC Financial Services Group	0	7	17	0	2.71
International Bancshares	0	0	1	0	3.00

The PNC Financial Services Group currently has a consensus price target of $266.13, suggesting a potential upside of 18.55%. International Bancshares has a consensus price target of $85.00, suggesting a potential upside of 26.56%. Given International Bancshares’ stronger consensus rating and higher probable upside, analysts clearly believe International Bancshares is more favorable than The PNC Financial Services Group.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
The PNC Financial Services Group	21.83%	12.82%	1.33%
International Bancshares	38.83%	12.67%	2.47%

Insider and Institutional Ownership

83.5% of The PNC Financial Services Group shares are owned by institutional investors. Comparatively, 65.9% of International Bancshares shares are owned by institutional investors. 0.4% of The PNC Financial Services Group shares are owned by insiders. Comparatively, 13.1% of International Bancshares shares are owned by 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.

Dividends

The PNC Financial Services Group pays an annual dividend of $8.00 per share and has a dividend yield of 3.6%. International Bancshares pays an annual dividend of $1.46 per share and has a dividend yield of 2.2%. The PNC Financial Services Group pays out 42.6% of its earnings in the form of a dividend. International Bancshares pays out 22.0% 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. The PNC Financial Services Group has increased its dividend for 14 consecutive years and International Bancshares has increased its dividend for 16 consecutive years.

Risk and Volatility

The PNC Financial Services Group has a beta of 0.94, indicating that its stock price is 6% less volatile than the S&P 500. Comparatively, International Bancshares has a beta of 0.68, indicating that its stock price is 32% less volatile than the S&P 500.

Earnings & Valuation

This table compares The PNC Financial Services Group and International Bancshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
The PNC Financial Services Group	$34.00 billion	2.63	$6.94 billion	$18.79	11.95
International Bancshares	$1.06 billion	3.96	$412.29 million	$6.63	10.13

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

Summary

The PNC Financial Services Group beats International Bancshares on 9 of the 17 factors compared between the two stocks.

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.

About International Bancshares

International Bancshares Corporation, a financial holding company, provides commercial and retail banking services in Texas and the State of Oklahoma. It accepts checking and saving deposits; and offers commercial, real estate, personal, home improvement, automobile, and other installment and term loans. The company also provides international banking services, including letters of credit, commercial and industrial loans, and foreign exchange services. In addition, it offers other banking related services, such as credit cards, safety deposit boxes, collection, notary public, escrow, drive up and walk up facilities, and other customary banking services; and Internet banking services, as well as securities products through third party providers. The company was founded in 1966 and is headquartered in Laredo, Texas.