The Toronto-Dominion Bank (NYSE:TD) and HDFC Bank (NYSE:HDB) are both large-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, dividends, valuation, profitability, institutional ownership, risk and analyst recommendations.
Analyst Recommendations
This is a breakdown of current ratings and target prices for The Toronto-Dominion Bank and HDFC Bank, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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The Toronto-Dominion Bank | 4 | 5 | 3 | 0 | 1.92 |
HDFC Bank | 0 | 1 | 0 | 0 | 2.00 |
The Toronto-Dominion Bank currently has a consensus target price of $75.25, indicating a potential upside of 21.04%. Given The Toronto-Dominion Bank's higher probable upside, research analysts plainly believe The Toronto-Dominion Bank is more favorable than HDFC Bank.
Insider and Institutional Ownership
48.0% of The Toronto-Dominion Bank shares are owned by institutional investors. Comparatively, 17.8% of HDFC Bank shares are owned by institutional investors. 1.0% of HDFC Bank shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Profitability
This table compares The Toronto-Dominion Bank and HDFC Bank's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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The Toronto-Dominion Bank | 22.23% | 11.63% | 0.62% |
HDFC Bank | 19.69% | 15.48% | 1.84% |
Risk & Volatility
The Toronto-Dominion Bank has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500. Comparatively, HDFC Bank has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.
Valuation & Earnings
This table compares The Toronto-Dominion Bank and HDFC Bank's top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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The Toronto-Dominion Bank | $39.92 billion | 2.83 | $8.85 billion | $3.99 | 15.58 |
HDFC Bank | $19.07 billion | 7.94 | $3.45 billion | $1.98 | 41.82 |
The Toronto-Dominion Bank has higher revenue and earnings than HDFC Bank. The Toronto-Dominion Bank is trading at a lower price-to-earnings ratio than HDFC Bank, indicating that it is currently the more affordable of the two stocks.
Summary
The Toronto-Dominion Bank beats HDFC Bank on 8 of the 14 factors compared between the two stocks.