Contrasting Radian Group (NYSE:RDN) and Swiss Re (OTCMKTS:SSREY)

Swiss Re (OTCMKTS:SSREY) and Radian Group (NYSE:RDN) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, dividends, earnings, risk and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings for Swiss Re and Radian Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Swiss Re	4	3	0	1	1.75
Radian Group	0	3	5	0	2.62

Radian Group has a consensus price target of $43.17, indicating a potential upside of 8.90%. Given Radian Group’s stronger consensus rating and higher probable upside, analysts plainly believe Radian Group is more favorable than Swiss Re.

Institutional and Insider Ownership

95.3% of Radian Group shares are held by institutional investors. 2.0% of Radian Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Swiss Re and Radian Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Swiss Re	$43.14 billion	1.15	$4.74 billion	N/A	N/A
Radian Group	$1.20 billion	4.40	$582.64 million	$4.06	9.76

Swiss Re has higher revenue and earnings than Radian Group.

Dividends

Swiss Re pays an annual dividend of $1.27 per share and has a dividend yield of 3.1%. Radian Group pays an annual dividend of $1.02 per share and has a dividend yield of 2.6%. Radian Group pays out 25.1% of its earnings in the form of a dividend. Radian Group has increased its dividend for 6 consecutive years.

Risk & Volatility

Swiss Re has a beta of 0.5, indicating that its share price is 50% less volatile than the S&P 500. Comparatively, Radian Group has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500.

Profitability

This table compares Swiss Re and Radian Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Swiss Re	N/A	N/A	N/A
Radian Group	40.50%	13.57%	6.95%

Summary

Radian Group beats Swiss Re on 11 of the 16 factors compared between the two stocks.

About Swiss Re

Swiss Re AG, together with its subsidiaries, provides wholesale reinsurance, insurance, other insurance-based forms of risk transfer, and other insurance-related services worldwide. The company operates through three segments: Property & Casualty Reinsurance, Life & Health Reinsurance, and Corporate Solutions. The Property & Casualty Reinsurance segment underwrites property reinsurance, including property, credit and surety, engineering, aviation, marine, agriculture, retakaful, and facultative reinsurance solutions; and casualty reinsurance, such as liability, motor, worker's compensation, personal accident, management and professional liability, cyber, and facultative reinsurance solutions. The Life & Health Reinsurance segment underwrites life and health insurance products. The Corporate Solutions segment offers standard risk transfer covers and multi-line programs to customized solutions. It serves stock and mutual insurance companies, public sector and governmental entities, mid-sized and large corporations, and individuals. The company was founded in 1863 and is headquartered in Zurich, Switzerland.

About Radian Group

Radian Group Inc., together with its subsidiaries, engages in the mortgage and real estate services business in the United States. It operates through two segments, Mortgage Insurance and Homegenius segments. The Mortgage Insurance segment aggregates, manages, and distributes U.S. mortgage credit risk for mortgage lending institutions and mortgage credit investors, through private mortgage insurance on residential first-lien mortgage loans; and other credit risk management solutions, including contract underwriting. The Homegenius segment offers title services, including a suite of insurance and non-insurance titles; tax and title data, centralized recording, document retrieval, and default curative title services; deed and property reports; closing and settlement services; mortgage underwriting and processing; escrow; appraisal management; and real estate brokerage. This segment also provides real estate valuation products and services; asset management services for managing real estate owned properties, which includes a web-based workflow solution; and a suite of real estate technology products and services to facilitate real estate transactions, such as proprietary platforms as a service solution. It serves mortgage originators, such as mortgage bankers, commercial banks, savings institutions, credit unions, and community banks; and consumers, mortgage lenders, mortgage and real estate investors, government-sponsored enterprises, real estate brokers and agents, and corporations for their employees. The company was formerly known as CMAC Investment Corp. and changed its name to Radian Group Inc. in June 1999. Radian Group Inc. was founded in 1977 and is headquartered in Wayne, Pennsylvania.