Analyzing Allstate (ALL) and HCI Group (HCI)
Allstate (NYSE: ALL) and HCI Group (NYSE:HCI) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, earnings, institutional ownership, profitability and dividends.
Volatility and Risk
Allstate has a beta of 0.97, meaning that its share price is 3% less volatile than the S&P 500. Comparatively, HCI Group has a beta of 2.25, meaning that its share price is 125% more volatile than the S&P 500.
Allstate pays an annual dividend of $1.48 per share and has a dividend yield of 1.6%. HCI Group pays an annual dividend of $1.40 per share and has a dividend yield of 4.0%. Allstate pays out 17.7% of its earnings in the form of a dividend. HCI Group pays out -74.1% 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. Allstate has raised its dividend for 7 consecutive years and HCI Group has raised its dividend for 4 consecutive years. HCI Group is clearly the better dividend stock, given its higher yield and lower payout ratio.
Insider & Institutional Ownership
76.5% of Allstate shares are held by institutional investors. Comparatively, 76.9% of HCI Group shares are held by institutional investors. 1.5% of Allstate shares are held by insiders. Comparatively, 20.4% of HCI Group 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.
This table compares Allstate and HCI Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares Allstate and HCI Group’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Allstate||$38.52 billion||0.84||$3.19 billion||$8.37||10.86|
|HCI Group||$264.45 million||1.29||$29.02 million||($1.89)||-18.44|
Allstate has higher revenue and earnings than HCI Group. HCI Group is trading at a lower price-to-earnings ratio than Allstate, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current recommendations for Allstate and HCI Group, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Allstate presently has a consensus target price of $95.31, indicating a potential upside of 4.86%. HCI Group has a consensus target price of $43.33, indicating a potential upside of 24.34%. Given HCI Group’s stronger consensus rating and higher probable upside, analysts clearly believe HCI Group is more favorable than Allstate.
The Allstate Corporation (Allstate) is a holding company for Allstate Insurance Company. The Company’s business is conducted principally through Allstate Insurance Company, Allstate Life Insurance Company and other subsidiaries. It is engaged in the property-liability insurance business and the life insurance, retirement and investment products business. Its segments include Allstate Protection, Allstate Financial, Discontinued Lines and Coverages, and Corporate and Other. The Allstate Protection segment sells private passenger auto, homeowners, and other property-liability insurance products through agencies and directly through contact centers and the Internet. The Allstate Financial segment sells life insurance and voluntary accident and health insurance products. The Corporate and Other segment consists of holding company activities and certain non-insurance operations. Its Discontinued Lines and Coverages segment includes results from property-liability insurance coverage.
About HCI Group
HCI Group, Inc. (HCI) is an insurance holding company. The Company operates through four operating divisions: property and casualty insurance, reinsurance, investment real estate and information technology. Its operations include Insurance Operations and Other Operations. Its Insurance Operations include property and casualty insurance, and reinsurance. The Company, through its subsidiary, Homeowners Choice Property & Casualty Insurance Company, Inc. (HCPCI), provides property and casualty insurance to homeowners, condominium owners and tenants on properties located in Florida. HCPCI also offers flood-endorsed and wind-only policies to new and pre-existing Florida customers. Its Other Operations include information technology (IT) and real estate. The Company’s real estate operations consist of multiple properties it owns and operates.
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