Critical Contrast: NatWest Group (NWG) versus Its Rivals

NatWest Group (NYSE:NWG) is one of 920 publicly-traded companies in the “Banks” industry, but how does it contrast to its competitors? We will compare NatWest Group to similar businesses based on the strength of its valuation, profitability, institutional ownership, earnings, risk, analyst recommendations and dividends.

Volatility & Risk

NatWest Group has a beta of 0.94, indicating that its share price is 6% less volatile than the S&P 500. Comparatively, NatWest Group’s competitors have a beta of 0.60, indicating that their average share price is 40% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for NatWest Group and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NatWest Group	0	3	6	1	2.80
NatWest Group Competitors	7449	30132	27686	1447	2.35

As a group, “Banks” companies have a potential upside of 15.14%. Given NatWest Group’s competitors higher possible upside, analysts plainly believe NatWest Group has less favorable growth aspects than its competitors.

Dividends

NatWest Group pays an annual dividend of $0.63 per share and has a dividend yield of 3.7%. NatWest Group pays out 31.3% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 9.3% and pay out 28.9% of their earnings in the form of a dividend. NatWest Group lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Insider and Institutional Ownership

1.3% of NatWest Group shares are owned by institutional investors. Comparatively, 47.9% of shares of all “Banks” companies are owned by institutional investors. 9.8% of shares of all “Banks” companies 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.

Valuation & Earnings

This table compares NatWest Group and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
NatWest Group	$38.91 billion	$7.69 billion	8.45
NatWest Group Competitors	$37.86 billion	$2.41 billion	19.01

NatWest Group has higher revenue and earnings than its competitors. NatWest Group is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares NatWest Group and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NatWest Group	20.10%	14.01%	0.82%
NatWest Group Competitors	15.48%	9.50%	0.93%

Summary

NatWest Group beats its competitors on 8 of the 15 factors compared.

NatWest Group Company Profile

NatWest Group plc, together with its subsidiaries, provides banking and financial products and services to personal, commercial, corporate, and institutional customers in the United Kingdom and internationally. It operates through Retail Banking, Private Banking, and Commercial & Institutional segments. The Retail Banking segment offers a range of banking products and related financial services, such as current accounts, mortgages, personal unsecured lending, and personal deposits, as well as mobile and online banking services. The Private Banking segment provides private banking and wealth management products for high-net-worth individuals and their business interests. The Commercial & Institutional segment offers banking and financial solutions to large corporate organisations, multi-nationals, and financial institutions. The company was formerly known as The Royal Bank of Scotland Group plc and changed its name to NatWest Group plc in July 2020. NatWest Group plc was founded in 1727 and is headquartered in Edinburgh, the United Kingdom.