FBL Financial Group (NYSE: FFG) and Torchmark Corporation (NYSE:TMK) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Earnings and Valuation

This table compares FBL Financial Group and Torchmark Corporation’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
FBL Financial Group $736.38 million 2.33 $184.11 million $4.61 14.95
Torchmark Corporation $4.02 billion 2.24 $864.53 million $4.66 16.64

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

Insider & Institutional Ownership

28.6% of FBL Financial Group shares are held by institutional investors. Comparatively, 71.9% of Torchmark Corporation shares are held by institutional investors. 0.6% of FBL Financial Group shares are held by insiders. Comparatively, 3.8% of Torchmark Corporation shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations for FBL Financial Group and Torchmark Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
FBL Financial Group 0 1 0 0 2.00
Torchmark Corporation 4 3 0 0 1.43

Torchmark Corporation has a consensus target price of $70.40, suggesting a potential downside of 9.18%. Given Torchmark Corporation’s higher probable upside, analysts clearly believe Torchmark Corporation is more favorable than FBL Financial Group.

Volatility & Risk

FBL Financial Group has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, Torchmark Corporation has a beta of 0.98, suggesting that its share price is 2% less volatile than the S&P 500.

Dividends

FBL Financial Group pays an annual dividend of $1.76 per share and has a dividend yield of 2.6%. Torchmark Corporation pays an annual dividend of $0.60 per share and has a dividend yield of 0.8%. FBL Financial Group pays out 38.2% of its earnings in the form of a dividend. Torchmark Corporation pays out 12.9% 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. FBL Financial Group has increased its dividend for 4 consecutive years and Torchmark Corporation has increased its dividend for 7 consecutive years.

Profitability

This table compares FBL Financial Group and Torchmark Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
FBL Financial Group 15.70% 9.12% 1.16%
Torchmark Corporation 13.96% 11.55% 2.55%

Summary

Torchmark Corporation beats FBL Financial Group on 12 of the 16 factors compared between the two stocks.

About FBL Financial Group

FBL Financial Group, Inc. sells individual life insurance and annuity products under the brand name of Farm Bureau Financial Services. The Company’s segments are Annuity Segment, which sells a variety of traditional annuity products; Life Insurance Segment, which sells a range of traditional and universal life insurance products, and Corporate and Other segment, which provides various support operations, corporate capital and other product lines. It also offers life and annuity products through its subsidiary, Greenfields Life Insurance Company. Its other subsidiaries support various functional areas and affiliates by providing investment advisory and marketing and distribution services. It manages all aspects of two Farm Bureau affiliated property-casualty insurance companies, Farm Bureau Property & Casualty Insurance Company and Western Agricultural Insurance Company.

About Torchmark Corporation

Torchmark Corporation (Torchmark) is an insurance holding company. The Company, through its subsidiaries, provides a range of life and health insurance products and annuities to a base of customers. The Company’s segments include life insurance, health insurance, annuities and investment. The life insurance segment includes traditional and interest-sensitive whole life insurance as well as term life insurance. The Health insurance products are guaranteed-renewable and include Medicare Supplement, critical illness, accident and limited-benefit supplemental hospital and surgical coverage’s. Annuities include fixed-benefit contracts. The Company markets its insurance products through various distribution channels, each of which sells the products of its insurance segments. Its subsidiaries include American Income Life Insurance Company (American Income) and Liberty National Life Insurance Company (Liberty National).

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