AA (OTCMKTS:AATDF) vs. Radian Group (NYSE:RDN) Financial Analysis

AA (OTCMKTS:AATDF) and Radian Group (NYSE:RDN) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, analyst recommendations, valuation, institutional ownership, earnings, profitability and risk.

Analyst Ratings

This is a breakdown of current ratings and price targets for AA and Radian Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AA	0	0	0	0	0.00
Radian Group	0	4	4	0	2.50

Radian Group has a consensus price target of $40.67, suggesting a potential upside of 14.75%. Given Radian Group’s stronger consensus rating and higher possible upside, analysts clearly believe Radian Group is more favorable than AA.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AA	N/A	N/A	N/A	N/A	N/A
Radian Group	$1.20 billion	3.99	$582.64 million	$4.15	8.54

Radian Group has higher revenue and earnings than AA.

Insider and Institutional Ownership

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
AA	N/A	N/A	N/A
Radian Group	46.99%	13.07%	6.98%

Summary

Radian Group beats AA on 9 of the 9 factors compared between the two stocks.

About AA

AA plc provides roadside assistance, insurance, and driving services in the United Kingdom. It operates through two segments, Roadside and Insurance. The company offers breakdowns cover for cars, motorcycles, caravans, vans, and towing; car, motorbike, van, and caravan insurance; and loans, savings, mortgage, travel currency card, insurance, and credit card products. It also provides home, content, building, pet, and holiday home insurance products; and travel services. In addition, the company offers driving advisory services, such as child safety, fuel and environment, legal advisory, service and repair, safety, security, and driving cost and other services; car and MOT services; and financial services, such as personal loans, car loans, home improvement loans, debt consolidation loans, wedding loans, loan management, savings, credit cards, and online security services, as well as reinsurance services. It serves fleet and leasing companies. The company was founded in 1905 and is headquartered in Basingstoke, the United Kingdom.

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.