American Financial Group (NYSE: AFG) is one of 92 public companies in the “Property & Casualty Insurance” industry, but how does it contrast to its peers? We will compare American Financial Group to related companies based on the strength of its risk, profitability, valuation, dividends, institutional ownership, analyst recommendations and earnings.

Institutional & Insider Ownership

62.3% of American Financial Group shares are held by institutional investors. Comparatively, 61.1% of shares of all “Property & Casualty Insurance” companies are held by institutional investors. 13.7% of American Financial Group shares are held by insiders. Comparatively, 15.3% of shares of all “Property & Casualty Insurance” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares American Financial Group and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
American Financial Group 11.89% 11.66% 1.07%
American Financial Group Competitors 10.13% 5.31% 2.72%

Dividends

American Financial Group pays an annual dividend of $1.40 per share and has a dividend yield of 1.3%. American Financial Group pays out 15.7% of its earnings in the form of a dividend. As a group, “Property & Casualty Insurance” companies pay a dividend yield of 1.4% and pay out 26.9% of their earnings in the form of a dividend. American Financial Group has raised its dividend for 11 consecutive years.

Valuation and Earnings

This table compares American Financial Group and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
American Financial Group $6.49 billion $1.16 billion 11.73
American Financial Group Competitors $11.75 billion $2.00 billion 36.27

American Financial Group’s peers have higher revenue and earnings than American Financial Group. American Financial Group is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a summary of current ratings for American Financial Group and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
American Financial Group 0 2 1 0 2.33
American Financial Group Competitors 608 2247 2132 42 2.32

American Financial Group currently has a consensus target price of $93.00, suggesting a potential downside of 10.79%. As a group, “Property & Casualty Insurance” companies have a potential downside of 0.40%. Given American Financial Group’s peers higher probable upside, analysts clearly believe American Financial Group has less favorable growth aspects than its peers.

Volatility & Risk

American Financial Group has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500. Comparatively, American Financial Group’s peers have a beta of 0.93, meaning that their average share price is 7% less volatile than the S&P 500.

Summary

American Financial Group peers beat American Financial Group on 10 of the 15 factors compared.

About American Financial Group

American Financial Group, Inc. (AFG) is a holding company engaged primarily in property and casualty insurance businesses. The Company, through Great American Insurance Group, focuses on commercial products for businesses, and is engaged in the sale of fixed and fixed-indexed annuities in the retail, financial institutions and education markets. It has four segments: Property and casualty insurance, Annuity, Run-off long-term care and life, and Other. It reports its property and casualty insurance business in specialty sub-segments, including Property and transportation, Specialty casualty and Specialty financial. AFG sells traditional fixed and fixed-indexed annuities in the retail, financial institutions and education markets through independent producers and through direct relationships with certain financial institutions. AFG also sells single premium annuities in financial institutions through direct relationships with certain banks and through independent agents and brokers.

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