Reviewing Japan Tobacco (JAPAY) & Bankinter (BKNIY)

Japan Tobacco (OTCMKTS: JAPAY) and Bankinter (OTCMKTS:BKNIY) are both consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, analyst recommendations, risk, dividends and valuation.

Institutional & Insider Ownership

0.1% of Japan Tobacco shares are owned by institutional investors. Comparatively, 0.0% of Bankinter shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Japan Tobacco and Bankinter’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Japan Tobacco	18.36%	14.62%	8.05%
Bankinter	27.11%	11.77%	0.71%

Analyst Ratings

This is a summary of current ratings and target prices for Japan Tobacco and Bankinter, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Japan Tobacco	0	0	0	0	N/A
Bankinter	0	1	0	0	2.00

Earnings and Valuation

This table compares Japan Tobacco and Bankinter’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Japan Tobacco	$19.09 billion	2.81	$3.49 billion	$0.98	13.67
Bankinter	$1.93 billion	4.74	$559.73 million	$0.62	16.47

Japan Tobacco has higher revenue and earnings than Bankinter. Japan Tobacco is trading at a lower price-to-earnings ratio than Bankinter, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Japan Tobacco has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500. Comparatively, Bankinter has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500.

Dividends

Japan Tobacco pays an annual dividend of $0.50 per share and has a dividend yield of 3.7%. Bankinter pays an annual dividend of $0.37 per share and has a dividend yield of 3.6%. Japan Tobacco pays out 51.0% of its earnings in the form of a dividend. Bankinter pays out 59.7% 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. Japan Tobacco is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Japan Tobacco beats Bankinter on 8 of the 12 factors compared between the two stocks.

About Japan Tobacco

Japan Tobacco Inc., together with its subsidiaries, manufactures and sells tobacco products, primarily cigarettes in Japan and internationally. It also distributes imported tobacco products. The company offers its tobacco products primarily under the Winston, Camel, Mevius, LD, Benson & Hedges (B&H), Glamour, Sobranie, Silk Cut, Natural American Spirit, Seven Stars, Pianissimo, Peace, HOPE, and other brand names. In addition, it engages in the research and development, manufacture, and sale of prescription drugs in the fields of metabolic diseases, viral infection, and autoimmune/inflammatory diseases. The company's pharmaceutical products include Riona tablets for the treatment of hyperphosphatemia, Remitch capsules for pruritus, and KAYEXALATE dry syrup for hyperkalemia; FUTHAN for injection, a protease inhibitor; ANTEBATE, a topical corticosteroid; CEDARTOLEN sublingual immunotherapy drugs; MITICURE House Dust Mite sublingual tablets; and Truvada, Stribild, Genvoya, and Descovy combination tablets for HIV. Further, it manufactures and sells staple food products, including frozen noodles, frozen rice, packed-cooked rice, and frozen baked bread; bakery products; and seasonings, including yeast extracts and oyster sauce. Japan Tobacco Inc. was founded in 1898 and is headquartered in Tokyo, Japan.

About Bankinter

Bankinter, S.A. provides various banking products and services for individual and corporate customers, and small and medium-sized enterprises in Spain and internationally. The company offers private banking services, including various funds; personal and corporate banking services; retail banking services, including salary accounts; mortgages; and consumer finance services comprising credit cards and loans. It also provides investment banking services, such as mergers and acquisitions, capital market, and structured and alternative financing services, as well as property financing services; and guarantees, import and export letters of credit, and medium and long-term structured finance services, as well as equities, asset management and specialized advisory, and delegated management services. In addition, the company offers insurance and pension plans; and telephone, Internet, and mobile banking services, as well as ATM services. As of December 31, 2016, it had 364 universal offices, 47 private banking centers, 72 business centers, and 22 corporate banking centers. The company was formerly known as Banco Intercontinental Español, S.A. and changed its name to Bankinter, S.A. in July 1990. Bankinter, S.A. was founded in 1965 and is headquartered in Madrid, Spain.

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