Health Insurance Innovations (NASDAQ: HIIQ) and Trupanion (NASDAQ:TRUP) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, dividends, risk, earnings, profitability and valuation.

Risk & Volatility

Health Insurance Innovations has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500. Comparatively, Trupanion has a beta of 0.14, indicating that its stock price is 86% less volatile than the S&P 500.

Profitability

This table compares Health Insurance Innovations and Trupanion’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Health Insurance Innovations 5.98% 21.32% 13.25%
Trupanion -1.05% -7.41% -3.73%

Analyst Ratings

This is a summary of recent ratings and price targets for Health Insurance Innovations and Trupanion, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Health Insurance Innovations 0 1 6 0 2.86
Trupanion 0 1 5 0 2.83

Health Insurance Innovations currently has a consensus target price of $32.00, suggesting a potential upside of 45.32%. Trupanion has a consensus target price of $27.20, suggesting a potential downside of 5.29%. Given Health Insurance Innovations’ stronger consensus rating and higher possible upside, research analysts clearly believe Health Insurance Innovations is more favorable than Trupanion.

Valuation and Earnings

This table compares Health Insurance Innovations and Trupanion’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Health Insurance Innovations $184.52 million 1.97 $4.51 million $1.19 18.50
Trupanion $188.23 million 4.58 -$6.89 million ($0.09) -319.11

Health Insurance Innovations has higher earnings, but lower revenue than Trupanion. Trupanion is trading at a lower price-to-earnings ratio than Health Insurance Innovations, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

68.1% of Health Insurance Innovations shares are held by institutional investors. Comparatively, 63.3% of Trupanion shares are held by institutional investors. 30.0% of Health Insurance Innovations shares are held by company insiders. Comparatively, 31.2% of Trupanion shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Health Insurance Innovations beats Trupanion on 10 of the 13 factors compared between the two stocks.

Health Insurance Innovations Company Profile

Health Insurance Innovations, Inc. is a developer, distributor and cloud-based administrator of individual and family health insurance plans (IFPs) and supplemental products, which include short-term medical (STM) insurance plans, and guaranteed-issue and underwritten hospital indemnity plans. The Company also develops, distributes and administers supplemental products, which include a range of additional insurance and non-insurance products, such as pharmacy benefit cards, dental plans, vision plans, cancer/critical illness plans, deductible and gap protection plans, and life insurance policies that are purchased as supplements to IFP. The Company’s STM plans are provided up to six months, 11 months, or 364 days of health insurance coverage with a range of deductible and copay levels. Individual major medical (IMM) plans cover prescription drugs, pre-existing conditions and preventive care, while STM plans provide optional coverage for prescription drugs.

Trupanion Company Profile

Trupanion, Inc. provides medical insurance plans for cats and dogs throughout the United States, Canada and Puerto Rico. The Company operates in two business segments: subscription business and other business. The subscription business segment includes monthly subscriptions for its medical plan, which are marketed to consumers. The other business segment includes other operations that are not directly marketed to consumers. The Company offers a software solution, Trupanion Express, which is designed to facilitate the direct payment of invoices to veterinary practices. Trupanion Express integrates with veterinarians’ practice management software, which allows the Company to access data. The Company’s subsidiaries include American Pet Insurance Company, Trupanion Managers USA, Inc., Trupanion Brokers Ontario, Inc. and Wyndham Insurance Company (SAC), Ltd.

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