Universal Insurance (NYSE:UVE) and Bowhead Specialty (NYSE:BOW) Head to Head Contrast

Universal Insurance (NYSE:UVE) and Bowhead Specialty (NYSE:BOW) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, risk, profitability, valuation, dividends, institutional ownership and analyst recommendations.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Universal Insurance and Bowhead Specialty, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Universal Insurance	0	0	1	0	3.00
Bowhead Specialty	0	4	5	0	2.56

Bowhead Specialty has a consensus price target of $36.50, indicating a potential upside of 44.49%. Given Bowhead Specialty’s higher probable upside, analysts plainly believe Bowhead Specialty is more favorable than Universal Insurance.

Insider & Institutional Ownership

66.6% of Universal Insurance shares are held by institutional investors. 16.6% of Universal Insurance shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Universal Insurance and Bowhead Specialty”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Universal Insurance	$1.52 billion	0.53	$58.93 million	$2.29	12.38
Bowhead Specialty	$425.66 million	1.95	$38.24 million	$1.47	17.19

Universal Insurance has higher revenue and earnings than Bowhead Specialty. Universal Insurance is trading at a lower price-to-earnings ratio than Bowhead Specialty, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Universal Insurance has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500. Comparatively, Bowhead Specialty has a beta of -0.88, suggesting that its share price is 188% less volatile than the S&P 500.

Profitability

This table compares Universal Insurance and Bowhead Specialty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Universal Insurance	4.24%	15.37%	2.21%
Bowhead Specialty	10.05%	13.25%	2.94%

Summary

Universal Insurance beats Bowhead Specialty on 8 of the 14 factors compared between the two stocks.

About Universal Insurance

Universal Insurance Holdings, Inc., together with its subsidiaries, operates as an integrated insurance holding company in the United States. It develops, markets, and underwrites insurance products for personal residential insurance, such as homeowners, renters/tenants, condo unit owners, and dwelling/fire; and offers allied lines, coverage for other structures, and personal property, liability, and personal articles coverages. The company also advises on actuarial issues, oversees distribution, administers claims payments, performs policy administration and underwriting, and assists with reinsurance negotiations; places and manages reinsurance programs for the insurance entities; and operates Clovered.com, a digital agency for various carrier partners and utilization of digital applications for adjusting claims. It offers its products through a network of independent agents, as well as direct-to-consumer online solutions, including digital insurance agency. The company was formerly known as Universal Heights, Inc. and changed its name to Universal Insurance Holdings, Inc. in January 2001. Universal Insurance Holdings, Inc. was incorporated in 1990 and is headquartered in Fort Lauderdale, Florida.

About Bowhead Specialty

Bowhead Specialty Holdings Inc. provides specialty property and casualty insurance products in the United States. It underwrites casualty insurance solutions for risks in the construction, distribution, heavy manufacturing, real estate, and hospitality segments; professional liability insurance solutions for financial institutions, private and public directors and officers liability insurance, errors and omissions liability insurance, and cyber segments; and healthcare solutions for hospitals, senior care providers, managed care organizations, miscellaneous medical facilities, and healthcare management liability segments. The company distributes its products through distribution partners in wholesale and retail markets. Bowhead Specialty Holdings Inc. was formerly known as Bowhead Holdings Inc. and changed its name to Bowhead Specialty Holdings Inc. in March 2024. The company was founded in 2020 and is based in New York, New York. Bowhead Specialty Holdings Inc. operates as a subsidiary of Bowhead Insurance Holdings LP.