Bowhead Specialty (NYSE:BOW) & Donegal Group (NASDAQ:DGICB) Head-To-Head Survey

Donegal Group (NASDAQ:DGICB) and Bowhead Specialty (NYSE:BOW) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, earnings, institutional ownership, valuation, dividends and risk.

Risk & Volatility

Donegal Group has a beta of 0.06, meaning that its share price is 94% less volatile than the S&P 500. Comparatively, Bowhead Specialty has a beta of -0.15, meaning that its share price is 115% less volatile than the S&P 500.

Profitability

This table compares Donegal Group and Bowhead Specialty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Donegal Group	6.77%	10.41%	2.70%
Bowhead Specialty	9.99%	13.80%	2.71%

Analyst Recommendations

This is a summary of current recommendations for Donegal Group and Bowhead Specialty, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Donegal Group	0	1	0	0	2.00
Bowhead Specialty	0	4	4	1	2.67

Bowhead Specialty has a consensus price target of $31.83, indicating a potential upside of 18.74%. Given Bowhead Specialty’s stronger consensus rating and higher possible upside, analysts clearly believe Bowhead Specialty is more favorable than Donegal Group.

Insider and Institutional Ownership

1.2% of Donegal Group shares are held by institutional investors. 8.6% of Donegal Group shares are held by insiders. Comparatively, 4.2% of Bowhead Specialty shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Donegal Group and Bowhead Specialty”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Donegal Group	$978.01 million	0.71	$79.34 million	$1.69	11.05
Bowhead Specialty	$551.59 million	1.60	$53.79 million	$1.73	15.50

Donegal Group has higher revenue and earnings than Bowhead Specialty. Donegal Group is trading at a lower price-to-earnings ratio than Bowhead Specialty, indicating that it is currently the more affordable of the two stocks.

Summary

Bowhead Specialty beats Donegal Group on 10 of the 15 factors compared between the two stocks.

About Donegal Group

Donegal Group Inc., an insurance holding company, provides personal and commercial lines of property and casualty insurance to businesses and individuals in the Mid-Atlantic, Midwestern, New England, and southern states. It operates through four segments: Investment Function, Personal Lines of Insurance, and Commercial Lines of Insurance. The company offers private passenger automobile policies that provide protection against liability for bodily injury and property damage arising from automobile accidents, as well as protection against loss from damage to automobiles. It also offers homeowners policies, which provide coverage for damage to residences and their contents from a range of perils, including fire, lightning, windstorm, and theft; and liability of the insured arising from injury to other persons or their property. In addition, the company offers commercial automobile policies that provide protection against liability for bodily injury and property damage arising from automobile accidents and protection against loss from damage to automobiles owned by the insured; commercial multi-peril policies that provide protection to businesses against various perils, primarily combining liability and physical damage coverages; and workers' compensation policies, which provide benefits to employees for injuries sustained during employment. The company markets its insurance products through a network of approximately 2,400 independent insurance agencies. Donegal Group Inc. was founded in 1986 and is headquartered in Marietta, Pennsylvania.

About Bowhead Specialty

Bowhead Specialty Holdings Inc. provides specialty property and casualty insurance products in the United States. It underwrites casualty insurance solutions for risks in the construction, distribution, heavy manufacturing, real estate, and hospitality segments; professional liability insurance solutions for financial institutions, private and public directors and officers liability insurance, errors and omissions liability insurance, and cyber segments; and healthcare solutions for hospitals, senior care providers, managed care organizations, miscellaneous medical facilities, and healthcare management liability segments. The company distributes its products through distribution partners in wholesale and retail markets. Bowhead Specialty Holdings Inc. was formerly known as Bowhead Holdings Inc. and changed its name to Bowhead Specialty Holdings Inc. in March 2024. The company was founded in 2020 and is based in New York, New York. Bowhead Specialty Holdings Inc. operates as a subsidiary of Bowhead Insurance Holdings LP.