Reviewing Exzeo Group (NYSE:XZO) & FG Nexus (NASDAQ:FGNX)

FG Nexus (NASDAQ:FGNX) and Exzeo Group (NYSE:XZO) are both small-cap financial services companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, profitability, institutional ownership, risk, analyst recommendations, earnings and valuation.

Valuation & Earnings

This table compares FG Nexus and Exzeo Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FG Nexus	$18.09 million	7.02	-$1.15 million	($3.50)	-0.92
Exzeo Group	N/A	N/A	N/A	N/A	N/A

Exzeo Group has lower revenue, but higher earnings than FG Nexus.

Analyst Recommendations

This is a breakdown of current ratings for FG Nexus and Exzeo Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FG Nexus	1	1	3	0	2.40
Exzeo Group	0	1	3	0	2.75

FG Nexus presently has a consensus target price of $8.50, indicating a potential upside of 164.80%. Exzeo Group has a consensus target price of $26.00, indicating a potential upside of 27.26%. Given FG Nexus’ higher possible upside, equities research analysts clearly believe FG Nexus is more favorable than Exzeo Group.

Profitability

This table compares FG Nexus and Exzeo Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FG Nexus	-64.92%	-7.73%	-4.93%
Exzeo Group	N/A	N/A	N/A

Institutional and Insider Ownership

3.1% of FG Nexus shares are held by institutional investors. 4.1% of FG Nexus shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

About FG Nexus

FG Financial Group, Inc. operates as a reinsurance and investment management holding company in the United States. The company offers specialty property and casualty reinsurance products and services. It also operates a special purpose acquisition company platform (SPAC) that provides various strategic, administrative, and regulatory support services to newly formed SPACs for a monthly fee. The company was formerly known as 1347 Property Insurance Holdings, Inc. and changed its name to FG Financial Group, Inc. in December 2020. The company was incorporated in 2012 and is based in St. Petersburg, Florida.

About Exzeo Group

Exzeo provides turnkey insurance technology and operations solutions to insurance carriers and their agents based on a proprietary platform of purpose-built software and data analytics applications that are specifically designed for the property and casualty, or P&C, insurance ecosystem. Exzeo’s Insurance-as-a-Service (IaaS) platform, which we refer to as the “Exzeo Platform,” currently includes nine highly configurable software and data analytics applications that are purpose-built to serve insurance companies and other customers in the insurance value chain. Through the Exzeo Platform, Exzeo provides technology-based solutions and services for all operational and administrative activities and functions needed by P&C insurance carriers and their agents, including quoting and underwriting, policy management, claims processing management, data reporting, and financial reporting. As a result, the Exzeo Platform streamlines and automates the interaction between insurance carriers and their policyholders. Exzeo was established in 2012 as the technology and innovation division of HCI Group, Inc., or HCI, a leading underwriter of homeowners insurance in Florida and 12 other states. Exzeo’s initial customers are insurance carriers or their managing general agent that are owned or managed by HCI and its subsidiaries, and Exzeo has derived substantially all of its revenues to date from such customers. In addition to working with existing customers to expand their business, Exzeo intends to develop new customer partnerships with additional carriers and their agents by introducing them to the advantage of our technology. Exzeo was founded with a clear mission: to develop a platform that enhances underwriting margins, reduces operating expenses, enables rapid expansion across both geographic markets and product lines, and delivers a streamlined, user-friendly experience for both carriers and policyholders. Exzeo’s data-centric technology and mission inspired its name, which is derived from the combination of three words that describe the “Big Data” it collects and utilizes in its products and services: Exabyte (a million trillion – 1018– bytes), Zettabyte (1021 bytes) and Yottabyte (1024 bytes). Exzeo generates revenue from underwriting and management services, claim services, and other technology services that are provided through and powered by the Exzeo Platform. Exzeo provides its solutions and technologies to customers under contracts with a variable fee structure that is typically based on a percentage of premium managed through the Exzeo Platform. Exzeo believes that this fee structure is beneficial to customers because it is designed to allow customers to scale while optimizing for operational efficiencies and without significant up-front technology expenditures. We currently hold insurance agency or managing general agent licenses, as appropriate, in 29 states. Through the Exzeo Platform, we currently provide services in the following 13 states in which our customers have operations: Florida, Connecticut, Georgia, Massachusetts, Montana, North Carolina, New Jersey, New Mexico, Nevada, Rhode Island, South Carolina, South Dakota, and Utah. We intend to expand our operations (and obtain additional licenses as needed) in the 21 remaining states based upon growth plans of our existing customers or the existing geographies and growth plans of new customers with which we engage. Exzeo Group, Inc. is the registrant and the issuer of the common stock being sold in this offering. Our corporate headquarters is located in Tampa, FL.