Barclays vs NatWest Which Is Superior?

Barclays and NatWest are two prominent financial institutions in the United Kingdom with well-established reputations in the banking sector. Their stocks are actively traded on the London Stock Exchange, making them popular choices for investors seeking exposure to the UK financial market. Barclays is known for its global presence and diverse range of financial services, while NatWest has a strong domestic presence and a focus on retail and commercial banking. Both stocks have been impacted by macroeconomic factors and regulatory changes in recent years, offering investors opportunities for growth and risk mitigation.

Barclays or NatWest?

When comparing Barclays and NatWest, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Barclays and NatWest.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Barclays has a dividend yield of 3.88%, while NatWest has a dividend yield of 5.41%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Barclays reports a 5-year dividend growth of 9.63% year and a payout ratio of 0.00%. On the other hand, NatWest reports a 5-year dividend growth of 59.37% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Barclays P/E ratio at 36.56 and NatWest's P/E ratio at 15.44. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Barclays P/B ratio is 2.58 while NatWest's P/B ratio is 1.91.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Barclays has seen a 5-year revenue growth of -0.76%, while NatWest's is -0.38%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Barclays's ROE at 8.15% and NatWest's ROE at 13.30%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $13.51 for Barclays and $10.30 for NatWest. Over the past year, Barclays's prices ranged from $7.07 to $13.83, with a yearly change of 95.62%. NatWest's prices fluctuated between $5.16 and $10.75, with a yearly change of 108.33%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.