Emergent Capital (NYSE: IFT) and Atlantic American Corporation (NASDAQ:AAME) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, dividends, risk, profitability, valuation and earnings.

Dividends

Atlantic American Corporation pays an annual dividend of $0.02 per share and has a dividend yield of 0.6%. Emergent Capital does not pay a dividend. Atlantic American Corporation pays out 18.2% of its earnings in the form of a dividend.

Institutional & Insider Ownership

5.1% of Atlantic American Corporation shares are owned by institutional investors. 79.3% of Atlantic American Corporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Emergent Capital and Atlantic American Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Emergent Capital -187.06% -15.14% -4.53%
Atlantic American Corporation 1.61% -0.56% -0.19%

Valuation & Earnings

This table compares Emergent Capital and Atlantic American Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Emergent Capital N/A N/A N/A N/A N/A
Atlantic American Corporation $169.97 million 0.40 $6.69 million $0.11 30.00

Atlantic American Corporation has higher revenue and earnings than Emergent Capital.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Emergent Capital and Atlantic American Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Emergent Capital 0 0 0 0 N/A
Atlantic American Corporation 0 0 0 0 N/A

Summary

Atlantic American Corporation beats Emergent Capital on 7 of the 9 factors compared between the two stocks.

Emergent Capital Company Profile

Emergent Capital, Inc., formerly Imperial Holdings, Inc., is a specialty finance company that invests in asset classes, primarily life settlements. The Company, through its subsidiary companies, owns a portfolio of approximately 630 life insurance policies (life settlements). The Company purchases individual policies and portfolios of life insurance policies and manages those assets based on actuarial and market data. The Company provides customized liquidity solutions to owners of illiquid financial assets in two markets, which include life finance and structured settlements. The Company focuses on lending to outright purchases of portfolios, to tertiary trades, as well as individual secondary market purchases. The Company invests in short and long-term life settlement investments.

Atlantic American Corporation Company Profile

Atlantic American Corporation is a holding company that operates through its subsidiaries in specialty markets within the life and health, and property and casualty insurance industries. The Company’s principal operating subsidiaries are American Southern Insurance Company and American Safety Insurance Company (together known as American Southern) within the property and casualty insurance industry, and Bankers Fidelity Life Insurance Company and Bankers Fidelity Assurance Company (together known as Bankers Fidelity) within the life and health insurance industry. Each of American Southern and Bankers Fidelity is managed separately based upon the type of products it offers. American Southern’s product lines include business automobile insurance policies, General Liability Insurance policies, Property Insurance policies and Surety Bonds. Products offered by Bankers Fidelity include ordinary and term life insurance, Medicare supplement and other accident and health insurance products.

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