Punjab National Bank vs Canara Bank Which Is a Smarter Choice?

Punjab National Bank (PNB) and Canara Bank are two of the largest public sector banks in India. The stocks of both banks are closely followed by investors due to their significant presence in the banking sector. PNB has faced challenges in the past, including a major fraud scandal, which has impacted its stock performance. Meanwhile, Canara Bank has shown more stability and steady growth in recent years. Investors continue to monitor both stocks for potential opportunities and risks in the financial market.

Punjab National Bank or Canara Bank?

When comparing Punjab National Bank and Canara Bank, 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 Punjab National Bank and Canara Bank.

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. Punjab National Bank has a dividend yield of 1.43%, while Canara Bank has a dividend yield of 3.1%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Punjab National Bank reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Canara Bank reports a 5-year dividend growth of 0.00% 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 Punjab National Bank P/E ratio at 8.02 and Canara Bank's P/E ratio at 5.89. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Punjab National Bank P/B ratio is 0.92 while Canara Bank's P/B ratio is 0.92.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Punjab National Bank has seen a 5-year revenue growth of 0.86%, while Canara Bank's is 2.09%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Punjab National Bank's ROE at 12.52% and Canara Bank's ROE at 16.75%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₹103.25 for Punjab National Bank and ₹101.70 for Canara Bank. Over the past year, Punjab National Bank's prices ranged from ₹75.60 to ₹142.90, with a yearly change of 89.02%. Canara Bank's prices fluctuated between ₹77.39 and ₹128.90, with a yearly change of 66.56%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.