Financial Survey: Assured Guaranty (NYSE:AGO) and Prudential Public (NYSE:PUK)

Prudential Public (NYSE:PUK) and Assured Guaranty (NYSE:AGO) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, earnings, risk, valuation, analyst recommendations, profitability and institutional ownership.

Institutional and Insider Ownership

1.9% of Prudential Public shares are owned by institutional investors. Comparatively, 92.2% of Assured Guaranty shares are owned by institutional investors. 0.1% of Prudential Public shares are owned by insiders. Comparatively, 5.1% of Assured Guaranty shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility & Risk

Prudential Public has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, Assured Guaranty has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Prudential Public and Assured Guaranty, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Prudential Public	0	1	5	0	2.83
Assured Guaranty	0	2	2	0	2.50

Assured Guaranty has a consensus target price of $101.00, indicating a potential upside of 18.77%. Given Assured Guaranty’s higher possible upside, analysts plainly believe Assured Guaranty is more favorable than Prudential Public.

Profitability

This table compares Prudential Public and Assured Guaranty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Prudential Public	N/A	N/A	N/A
Assured Guaranty	45.31%	7.77%	3.68%

Dividends

Prudential Public pays an annual dividend of $0.29 per share and has a dividend yield of 1.0%. Assured Guaranty pays an annual dividend of $1.52 per share and has a dividend yield of 1.8%. Assured Guaranty pays out 14.8% of its earnings in the form of a dividend. Assured Guaranty has increased its dividend for 7 consecutive years. Assured Guaranty is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Prudential Public and Assured Guaranty”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Prudential Public	$16.66 billion	2.26	$2.29 billion	N/A	N/A
Assured Guaranty	$1.11 billion	3.44	$503.00 million	$10.24	8.30

Prudential Public has higher revenue and earnings than Assured Guaranty.

Summary

Assured Guaranty beats Prudential Public on 10 of the 15 factors compared between the two stocks.

About Prudential Public

Prudential plc, through its subsidiaries, provides life and health insurance, and asset management solutions to individuals in Asia and Africa. The company was founded in 1848 and is headquartered in Central, Hong Kong.

About Assured Guaranty

Assured Guaranty Ltd., together with its subsidiaries, provides credit protection products to public finance, infrastructure, and structured finance markets in the United States and internationally. It operates through two segments: Insurance and Asset Management. The company offers financial guaranty insurance that protects holders of debt instruments and other monetary obligations from defaults in scheduled payments. It insures and reinsures various debt obligations, including bonds issued by the United States state governmental authorities; and notes issued to finance infrastructure projects. In addition, the company insures and reinsures various the U.S. public finance obligations, such as general obligation, tax-backed, municipal utility, transportation, healthcare, higher education, infrastructure, housing revenue, investor-owned utility, renewable energy, and other public finance bonds. Further, the company involved in insuring and reinsuring of non-U.S. public finance obligations comprising regulated utilities, infrastructure finance, sovereign and sub-sovereign, renewable energy bonds, pooled infrastructure, and other public finance obligations; and the U.S. and non-U.S. Structured finance obligations, including residential mortgage-backed securities, life insurance transactions, consumer receivables securities, subscription finance facilities, pooled corporate obligations, and financial products. Additionally, it offers specialty business, such as real estate properties, insurance securitizations, and aircraft residual value insurance (RVI) transactions; and asset management services comprising investment advisory services. It markets its financial guaranty insurance directly to issuers and underwriters of public finance and structured finance securities, as well as to investors in such obligations. Assured Guaranty Ltd. was incorporated in 2003 and is headquartered in Hamilton, Bermuda.