Critical Analysis: Old Republic International (NYSE:ORI) vs. F&G Annuities & Life (NYSE:FG)

F&G Annuities & Life (NYSE:FG) and Old Republic International (NYSE:ORI) are both mid-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, dividends, valuation and institutional ownership.

Volatility and Risk

F&G Annuities & Life has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500. Comparatively, Old Republic International has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500.

Profitability

This table compares F&G Annuities & Life and Old Republic International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
F&G Annuities & Life	6.89%	10.28%	0.50%
Old Republic International	11.71%	15.41%	3.10%

Institutional and Insider Ownership

95.9% of F&G Annuities & Life shares are owned by institutional investors. Comparatively, 70.9% of Old Republic International shares are owned by institutional investors. 2.5% of F&G Annuities & Life shares are owned by company insiders. Comparatively, 1.3% of Old Republic International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and price targets for F&G Annuities & Life and Old Republic International, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
F&G Annuities & Life	1	3	0	0	1.75
Old Republic International	0	2	1	0	2.33

F&G Annuities & Life presently has a consensus price target of $30.00, suggesting a potential upside of 36.97%. Old Republic International has a consensus price target of $41.50, suggesting a potential upside of 9.08%. Given F&G Annuities & Life’s higher possible upside, equities research analysts clearly believe F&G Annuities & Life is more favorable than Old Republic International.

Valuation & Earnings

This table compares F&G Annuities & Life and Old Republic International”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
F&G Annuities & Life	$5.73 billion	0.50	$265.00 million	$2.93	7.48
Old Republic International	$9.14 billion	1.01	$935.40 million	$4.23	8.99

Old Republic International has higher revenue and earnings than F&G Annuities & Life. F&G Annuities & Life is trading at a lower price-to-earnings ratio than Old Republic International, indicating that it is currently the more affordable of the two stocks.

Dividends

F&G Annuities & Life pays an annual dividend of $1.00 per share and has a dividend yield of 4.6%. Old Republic International pays an annual dividend of $1.26 per share and has a dividend yield of 3.3%. F&G Annuities & Life pays out 34.1% of its earnings in the form of a dividend. Old Republic International pays out 29.8% 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. F&G Annuities & Life has increased its dividend for 2 consecutive years and Old Republic International has increased its dividend for 45 consecutive years.

Summary

Old Republic International beats F&G Annuities & Life on 12 of the 17 factors compared between the two stocks.

About F&G Annuities & Life

F&G Annuities & Life, Inc. engages in the provision of fixed annuity and life insurance products. It specializes in life insurance, annuities, retirement planning and wealth transfer. The company was founded in 1959 and is headquartered in Des Moines, IA.

About Old Republic International

Old Republic International Corporation, through its subsidiaries, engages in the insurance underwriting and related services business primarily in the United States and Canada. It operates through three segments: General Insurance, Title Insurance, and Republic Financial Indemnity Group Run-off Business. The General Insurance segment offers aviation, commercial auto, commercial multi-peril, commercial property, general liability, home and auto warranty, inland marine, travel accident, and workers' compensation insurance products; and financial indemnity products for specialty coverages, including errors and omissions, fidelity, directors and officers, and surety. This segment provides its insurance products to businesses, state and local government, and other institutions in transportation, commercial construction, healthcare, education, retail and wholesale trade, forest products, energy, general manufacturing, and financial services industries. The Title Insurance segment offers lenders' and owners' policies to real estate purchasers and investors based upon searches of the public records. This segment also provides escrow closing and construction disbursement services; and real estate information products, national default management services, and various other services pertaining to real estate transfers and loan transactions. The Republic Financial Indemnity Group Run-off Business segment offers private mortgage insurance coverage that protects mortgage lenders and investors from default related losses on residential mortgage loans made primarily to homebuyers. Old Republic International Corporation was founded in 1923 and is based in Chicago, Illinois.