Reviewing Banco de Sabadell (OTCMKTS:BNDSF) and Bank of Montreal (NYSE:BMO)

Bank of Montreal (NYSE:BMO) and Banco de Sabadell (OTCMKTS:BNDSF) are both financial services companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, earnings, risk and dividends.

Institutional and Insider Ownership

45.8% of Bank of Montreal shares are owned by institutional investors. Comparatively, 11.8% of Banco de Sabadell shares are owned by institutional investors. 1.0% of Bank of Montreal shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Bank of Montreal and Banco de Sabadell’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bank of Montreal	8.25%	11.60%	0.62%
Banco de Sabadell	N/A	N/A	N/A

Valuation and Earnings

This table compares Bank of Montreal and Banco de Sabadell’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bank of Montreal	$33.85 billion	1.90	$3.24 billion	$6.02	14.66
Banco de Sabadell	N/A	N/A	N/A	$0.08	25.83

Bank of Montreal has higher revenue and earnings than Banco de Sabadell. Bank of Montreal is trading at a lower price-to-earnings ratio than Banco de Sabadell, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and target prices for Bank of Montreal and Banco de Sabadell, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bank of Montreal	0	4	4	0	2.50
Banco de Sabadell	0	0	0	0	N/A

Bank of Montreal presently has a consensus target price of $124.00, suggesting a potential upside of 40.46%. Given Bank of Montreal’s higher probable upside, equities analysts clearly believe Bank of Montreal is more favorable than Banco de Sabadell.

Summary

Bank of Montreal beats Banco de Sabadell on 9 of the 10 factors compared between the two stocks.

About Bank of Montreal

Bank of Montreal provides diversified financial services primarily in North America. It operates through Canadian P&C, U.S P&C, BMO Wealth Management, and BMO Capital Markets segments. The company’s personal banking products and services include deposits, mortgages, home lending, consumer credit, small business lending, credit cards, cash management, financial and investment advice, and other banking services; and commercial banking products and services comprise various of financing options and treasury and payment solutions, as well as risk management products. It also offers investing, banking, and wealth management advisory; digital investing services; financial solutions for individuals, families, and businesses; provides investment management services to institutional, retail, and high net worth investors; and diversified insurance, and wealth and pension de-risking solutions. In addition, the company provides individual life, critical illness and annuity products, as well as segregated funds, and group creditor and travel insurance to customers; debt and equity capital-raising, loan origination and syndication, balance sheet management, treasury management, mergers and acquisitions advice, restructurings and recapitalizations, trade finance, and risk mitigation services, as well as a range of banking and other operating services. Further, the company offers research and access to financial markets for institutional, corporate and retail clients through an integrated suite of sales and trading solutions related to debt, foreign exchange, interest rates, credit, equities, securitization, and commodities; provides new product development and origination services, as well as risk management and advisory services for hedging strategies, including in interest rates, foreign exchange rates and commodities prices; and funding and liquidity management services. The company was founded in 1817 and is headquartered in Montreal, Canada.

About Banco de Sabadell

Banco de Sabadell, S.A. provides banking products and services to personal, business, and private customers in Spain and internationally. The company offers retail banking products, such as current and savings accounts, personal loans, cards, and mortgages. It also provides financial products and services to large and medium enterprises, SMEs, shops and self-employed workers, private individuals, and professionals; and consumer finance, asset management, and bancassurance services. In addition, the company offers corporate banking services, including financing services, transactional banking services, and other complex custom solutions in finance, treasury, and import/export, among others. Further, it provides insurance and pension products. The company was founded in 1881 and is based in Alicante, Spain.