Critical Contrast: Allied World Assurance (AWHHF) vs. Travelers Companies (TRV)
Allied World Assurance (OTCMKTS: AWHHF) and Travelers Companies (NYSE:TRV) are both companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, earnings, analyst recommendations, profitability and valuation.
Valuation & Earnings
This table compares Allied World Assurance and Travelers Companies’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Allied World Assurance||N/A||N/A||N/A||$2.97||17.36|
|Travelers Companies||$28.90 billion||1.34||$2.06 billion||$7.78||18.29|
This table compares Allied World Assurance and Travelers Companies’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Allied World Assurance||12.56%||8.96%||2.42%|
Volatility & Risk
Allied World Assurance has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500. Comparatively, Travelers Companies has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500.
This is a summary of recent recommendations and price targets for Allied World Assurance and Travelers Companies, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Allied World Assurance||0||1||0||0||2.00|
Allied World Assurance presently has a consensus price target of $24.50, indicating a potential downside of 52.47%. Travelers Companies has a consensus price target of $136.57, indicating a potential downside of 4.03%. Given Travelers Companies’ stronger consensus rating and higher possible upside, analysts clearly believe Travelers Companies is more favorable than Allied World Assurance.
Institutional and Insider Ownership
86.5% of Allied World Assurance shares are held by institutional investors. Comparatively, 79.4% of Travelers Companies shares are held by institutional investors. 3.2% of Allied World Assurance shares are held by company insiders. Comparatively, 0.8% of Travelers Companies shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Allied World Assurance pays an annual dividend of $0.52 per share and has a dividend yield of 1.0%. Travelers Companies pays an annual dividend of $2.88 per share and has a dividend yield of 2.0%. Allied World Assurance pays out 17.5% of its earnings in the form of a dividend. Travelers Companies pays out 37.0% 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. Travelers Companies has raised its dividend for 9 consecutive years. Travelers Companies is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Travelers Companies beats Allied World Assurance on 9 of the 15 factors compared between the two stocks.
Allied World Assurance Company Profile
Allied World Assurance Company Holdings Ltd is a Germany-based holding company. It provides property, casualty and specialty insurance and reinsurance solutions to clients around the world. The Company operates in three segments: North American Insurance, Global Markets Insurance and Reinsurance. The North American Insurance segment consists of the Company’s direct insurance operations in the United States, Bermuda and Canada. The Global Markets Insurance segment includes all of the Company’s direct insurance operations outside of North America. The Company’s reinsurance segment includes the reinsurance of property, general casualty, professional liability, specialty lines and property catastrophe coverage’s written by other reinsurance companies. The Company leases space in Australia, Bermuda, Canada, Hong Kong, Ireland, Labuan, Singapore, the United Kingdom and the United States for the operation of its North American Insurance, Global Markets Insurance and Reinsurance segments.
Travelers Companies Company Profile
The Travelers Companies, Inc. is a holding company. The Company’s segments include Business and International Insurance; Bond & Specialty Insurance, and Personal Insurance. Through its subsidiaries, it provides commercial and personal property and casualty insurance products and services. The Business and International Insurance segment offers property and casualty insurance and insurance related services to its clients, in the United States and in Canada, as well as in the United Kingdom, the Republic of Ireland, Brazil and throughout other parts of the world. The Bond & Specialty Insurance segment provides surety, fidelity, management liability, professional liability, and other property and casualty coverages and related risk management services to a range of primarily domestic customers, utilizing various degrees of financially-based underwriting approaches. The Personal Insurance segment writes a range of property and casualty insurance covering individuals’ personal risks.
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