Head to Head Contrast: Employers (NYSE:EIG) & Accelerant (NYSE:ARX)

Accelerant (NYSE:ARX) and Employers (NYSE:EIG) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, valuation, analyst recommendations, risk, earnings, dividends and institutional ownership.

Earnings and Valuation

This table compares Accelerant and Employers”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Accelerant	$912.90 million	4.70	-$1.35 billion	($6.65)	-2.97
Employers	$858.70 million	1.06	$10.80 million	$0.69	73.20

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

Profitability

This table compares Accelerant and Employers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Accelerant	-113.08%	42.79%	3.68%
Employers	0.91%	1.30%	0.35%

Risk & Volatility

Accelerant has a beta of 0.08, meaning that its share price is 92% less volatile than the S&P 500. Comparatively, Employers has a beta of 0.46, meaning that its share price is 54% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Accelerant and Employers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Accelerant	2	7	3	0	2.08
Employers	0	2	1	0	2.33

Accelerant currently has a consensus target price of $17.98, suggesting a potential downside of 9.01%. Employers has a consensus target price of $59.00, suggesting a potential upside of 16.82%. Given Employers’ stronger consensus rating and higher probable upside, analysts plainly believe Employers is more favorable than Accelerant.

Insider and Institutional Ownership

80.5% of Employers shares are held by institutional investors. 66.6% of Accelerant shares are held by company insiders. Comparatively, 1.3% of Employers 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.

Summary

Employers beats Accelerant on 8 of the 14 factors compared between the two stocks.

About Accelerant

Accelerant Holdings, together with its subsidiaries, operates a data-driven risk exchange that connects selected specialty insurance underwriters with risk capital partners. It operates through Exchange Services, MGA Operations, and Underwriting segments. The Exchange Services segment consists of risk exchange, its operating platform that incorporates various technology, data ingestion, and agency operations that serve the needs of its members and risk capital partners. Its Risk capital partners write premiums directly through the Risk Exchange pay us a fixed-percentage, volume-based fee for sourcing, managing, and monitoring the business they write. The MGA Operations segment includes the fees earned by members, predominantly for originating and underwriting a portfolio of insurance policies, reduced by the expenses associated with providing services. The Underwriting segment is involved in underwriting insurance policies and assumption of reinsurance policies issued or accepted by consolidated insurance and reinsurance companies. The activities of insurance companies include property and casualty insurance, policy issuance, and reinsurance arrangements. It serves small-to-medium sized commercial clients primarily in the United States, Europe, Canada, Australia, and the United Kingdom. Accelerant Holdings was founded in 2018 and is based in Grand Cayman, Cayman Islands.

About Employers

Employers Holdings, Inc., through its subsidiaries, operates in the commercial property and casualty insurance industry primarily in the United States. The company operates in two segments, Employers and Cerity. It offers workers’ compensation insurance to small businesses in low to medium hazard industries under the Employers and Cerity brands. The company markets its products through local, regional, and national agents and brokers; alternative distribution channels; and national, regional, and local trade groups and associations, as well as directly to customers. Employers Holdings, Inc. was founded in 2000 and is based in Henderson, Nevada.