United Insurance Holdings Corp. (NASDAQ: UIHC) and Universal Insurance Holdings (NYSE:UVE) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, risk, earnings, dividends and institutional ownership.

Profitability

This table compares United Insurance Holdings Corp. and Universal Insurance Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
United Insurance Holdings Corp. 0.73% 4.99% 1.34%
Universal Insurance Holdings 14.21% 25.85% 8.56%

Risk and Volatility

United Insurance Holdings Corp. has a beta of 1.61, suggesting that its share price is 61% more volatile than the S&P 500. Comparatively, Universal Insurance Holdings has a beta of 1.82, suggesting that its share price is 82% more volatile than the S&P 500.

Earnings & Valuation

This table compares United Insurance Holdings Corp. and Universal Insurance Holdings’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
United Insurance Holdings Corp. $559.34 million 1.23 $28.75 million $0.02 809.00
Universal Insurance Holdings $711.40 million 1.14 $166.43 million $2.81 8.26

Universal Insurance Holdings has higher revenue and earnings than United Insurance Holdings Corp.. Universal Insurance Holdings is trading at a lower price-to-earnings ratio than United Insurance Holdings Corp., indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations for United Insurance Holdings Corp. and Universal Insurance Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
United Insurance Holdings Corp. 0 1 2 1 3.00
Universal Insurance Holdings 0 0 1 0 3.00

United Insurance Holdings Corp. presently has a consensus price target of $15.25, indicating a potential downside of 5.75%. Universal Insurance Holdings has a consensus price target of $29.00, indicating a potential upside of 25.00%. Given Universal Insurance Holdings’ higher probable upside, analysts clearly believe Universal Insurance Holdings is more favorable than United Insurance Holdings Corp..

Insider and Institutional Ownership

28.0% of United Insurance Holdings Corp. shares are held by institutional investors. Comparatively, 77.3% of Universal Insurance Holdings shares are held by institutional investors. 22.6% of United Insurance Holdings Corp. shares are held by insiders. Comparatively, 10.5% of Universal Insurance Holdings shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

United Insurance Holdings Corp. pays an annual dividend of $0.24 per share and has a dividend yield of 1.5%. Universal Insurance Holdings pays an annual dividend of $0.56 per share and has a dividend yield of 2.4%. United Insurance Holdings Corp. pays out 1,200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Universal Insurance Holdings pays out 19.9% of its earnings in the form of a dividend. United Insurance Holdings Corp. has increased its dividend for 3 consecutive years. Universal Insurance Holdings is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Universal Insurance Holdings beats United Insurance Holdings Corp. on 11 of the 17 factors compared between the two stocks.

About United Insurance Holdings Corp.

United Insurance Holdings Corp. is a property and casualty insurance holding company that sources, writes and services residential property and casualty insurance policies using a network of agents and a group of insurance subsidiaries. The Company’s insurance subsidiary is United Property & Casualty Insurance Company. Its other subsidiaries include United Insurance Management, L.C., the managing general agent that manages substantially all aspects of United Property & Casualty Insurance Company’s business; Skyway Claims Services, LLC, which provides services to its insurance affiliate; UPC Re, which provides a portion of the reinsurance protection purchased by its insurance affiliate. The Company’s principal product is homeowners’ insurance, which it offers in Connecticut, Florida, Georgia, Hawaii, Louisiana, Massachusetts, New Jersey, North Carolina, Rhode Island, South Carolina and Texas.

About Universal Insurance Holdings

Universal Insurance Holdings, Inc. (UVE) is a private personal residential homeowners insurance company in Florida. The Company performs substantially all aspects of insurance underwriting, policy issuance, general administration, and claims processing and settlement internally. The Company’s subsidiaries include Universal Property & Casualty Insurance Company (UPCIC) and American Platinum Property and Casualty Insurance Company (APPCIC). UPCIC writes homeowners insurance policies in states, including Alabama, Delaware, Florida, Georgia, Hawaii, Indiana, Maryland, Massachusetts, Michigan, Minnesota, North Carolina, Pennsylvania, South Carolina and Virginia. APPCIC writes homeowners and commercial residential insurance policies in Florida. The Company has developed a suite of applications that provide underwriting, policy and claim administration services, including billing, policy maintenance, inspections, refunds, commissions and data analysis.

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