Analyzing Old Republic International (NYSE:ORI) and Horace Mann Educators (NYSE:HMN)

Old Republic International (NYSE:ORI) and Horace Mann Educators (NYSE:HMN) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, valuation, dividends, analyst recommendations, institutional ownership and profitability.

Profitability

This table compares Old Republic International and Horace Mann Educators’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Old Republic International	10.83%	15.71%	3.23%
Horace Mann Educators	9.63%	14.15%	1.35%

Institutional and Insider Ownership

70.9% of Old Republic International shares are owned by institutional investors. Comparatively, 99.3% of Horace Mann Educators shares are owned by institutional investors. 1.3% of Old Republic International shares are owned by company insiders. Comparatively, 3.6% of Horace Mann Educators shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Old Republic International and Horace Mann Educators, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Old Republic International	1	1	1	1	2.50
Horace Mann Educators	0	1	2	0	2.67

Old Republic International currently has a consensus price target of $42.00, suggesting a potential upside of 12.94%. Horace Mann Educators has a consensus price target of $46.50, suggesting a potential upside of 0.68%. Given Old Republic International’s higher probable upside, equities research analysts clearly believe Old Republic International is more favorable than Horace Mann Educators.

Dividends

Old Republic International pays an annual dividend of $1.26 per share and has a dividend yield of 3.4%. Horace Mann Educators pays an annual dividend of $1.44 per share and has a dividend yield of 3.1%. Old Republic International pays out 33.8% of its earnings in the form of a dividend. Horace Mann Educators pays out 36.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Old Republic International has raised its dividend for 45 consecutive years and Horace Mann Educators has raised its dividend for 17 consecutive years. Old Republic International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Old Republic International and Horace Mann Educators”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Old Republic International	$9.14 billion	0.99	$935.40 million	$3.73	9.97
Horace Mann Educators	$1.70 billion	1.10	$162.10 million	$3.98	11.60

Old Republic International has higher revenue and earnings than Horace Mann Educators. Old Republic International is trading at a lower price-to-earnings ratio than Horace Mann Educators, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Old Republic International has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500. Comparatively, Horace Mann Educators has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500.

Summary

Old Republic International beats Horace Mann Educators on 11 of the 18 factors compared between the two stocks.

About Old Republic International

Old Republic International Corporation, through its subsidiaries, engages in the insurance underwriting and related services business primarily in the United States and Canada. It operates through three segments: General Insurance, Title Insurance, and Republic Financial Indemnity Group Run-off Business. The General Insurance segment offers aviation, commercial auto, commercial multi-peril, commercial property, general liability, home and auto warranty, inland marine, travel accident, and workers' compensation insurance products; and financial indemnity products for specialty coverages, including errors and omissions, fidelity, directors and officers, and surety. This segment provides its insurance products to businesses, state and local government, and other institutions in transportation, commercial construction, healthcare, education, retail and wholesale trade, forest products, energy, general manufacturing, and financial services industries. The Title Insurance segment offers lenders' and owners' policies to real estate purchasers and investors based upon searches of the public records. This segment also provides escrow closing and construction disbursement services; and real estate information products, national default management services, and various other services pertaining to real estate transfers and loan transactions. The Republic Financial Indemnity Group Run-off Business segment offers private mortgage insurance coverage that protects mortgage lenders and investors from default related losses on residential mortgage loans made primarily to homebuyers. Old Republic International Corporation was founded in 1923 and is based in Chicago, Illinois.

About Horace Mann Educators

Horace Mann Educators Corporation, together with its subsidiaries, operates as an insurance holding company in the United States. The company operates through Property & Casualty, Life & Retirement, and Supplemental & Group Benefits segments. Its Property & Casualty segment offers insurance products, including private passenger auto insurance, residential home insurance, and personal umbrella insurance; and provides auto coverages including liability and collision, and property coverage for homeowners and renters. The Life & Retirement segment markets tax-qualified fixed, fixed indexed, and variable annuities; and internal revenue code for educator, which allows public school employees and employees of other tax-exempt organizations, such as not-for-profit private schools, to utilize pretax income to make periodic contributions to a qualified retirement plan. The Supplemental & Group Benefits segment offers employer-sponsored products including accident, critical illness, limited-benefit fixed indemnity insurance, term life, and short-term and long-term disability, as well as worksite direct products, such as supplemental heart, cancer, disability, and accident coverage. The company was founded in 1945 and is headquartered in Springfield, Illinois.