Employers (NYSE:EIG) and Kingsway Financial Services (NYSE:KFS) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, earnings, dividends and risk.
Volatility & Risk
Employers has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500. Comparatively, Kingsway Financial Services has a beta of 0.17, indicating that its stock price is 83% less volatile than the S&P 500.
Valuation and Earnings
This table compares Employers and Kingsway Financial Services’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Employers||$799.30 million||1.74||$101.20 million||$2.89||14.68|
|Kingsway Financial Services||$193.19 million||0.27||-$15.46 million||N/A||N/A|
Employers has higher revenue and earnings than Kingsway Financial Services.
This table compares Employers and Kingsway Financial Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kingsway Financial Services||-12.53%||-74.78%||-5.62%|
Institutional and Insider Ownership
79.9% of Employers shares are owned by institutional investors. Comparatively, 23.2% of Kingsway Financial Services shares are owned by institutional investors. 3.0% of Employers shares are owned by company insiders. Comparatively, 49.0% of Kingsway Financial Services shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Employers pays an annual dividend of $0.80 per share and has a dividend yield of 1.9%. Kingsway Financial Services does not pay a dividend. Employers pays out 27.7% of its earnings in the form of a dividend. Employers has raised its dividend for 3 consecutive years.
This is a breakdown of recent recommendations and price targets for Employers and Kingsway Financial Services, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kingsway Financial Services||0||0||0||0||N/A|
Employers currently has a consensus target price of $47.00, indicating a potential upside of 10.80%. Given Employers’ higher possible upside, research analysts plainly believe Employers is more favorable than Kingsway Financial Services.
Employers beats Kingsway Financial Services on 12 of the 14 factors compared between the two stocks.
Employers Holdings, Inc., through its subsidiaries, operates in the commercial property and casualty insurance industry primarily in the United States. It offers workers' compensation insurance to small businesses in low to medium hazard industries. The company markets its products through independent local, regional, and national agents and brokers; and alternative distribution channels comprising its partners, as well as through national, regional, and local trade groups and associations. Employers Holdings, Inc. was founded in 2000 and is based in Reno, Nevada.
About Kingsway Financial Services
Kingsway Financial Services Inc., through its subsidiaries, provides property and casualty insurance products in the United States. The company operates through three segments: Insurance Underwriting, Extended Warranty, and Leased Real Estate. The Insurance Underwriting segment offers various automobile insurance products, including liability insurance that covers claims against its insured's responsible for automobile accidents; accident benefit policies or personal injury protection policies that provide coverage for loss of income, medical, and rehabilitation expenses for insured persons who are injured in an automobile accident; and physical damage policies, which cover damages to an insured automobile arising from a collision with another object, as well as from other risks, such as fire or theft. The Extended Warranty segment markets and administers vehicle service agreements and related products for new and used automobiles. This segment also markets and distributes warranty products to manufacturers, distributors, and installers of heating, ventilation and air conditioning, standby generator, commercial LED lighting, and refrigeration equipment; and equipment breakdown and maintenance support services to companies. The Leased Real Estate segment owns the Real Property, which is subject to a long-term triple net lease agreement. The company offers its products and services to credit unions, consumers, and businesses through a network of independent agencies. Kingsway Financial Services Inc. was founded in 1989 and is based in Toronto, Canada.
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