Lincoln National Corporation (NYSE: LNC) and Aegon NV (NYSE:AEG) are both large-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, valuation, risk and profitability.

Dividends

Lincoln National Corporation pays an annual dividend of $1.16 per share and has a dividend yield of 1.6%. Aegon NV pays an annual dividend of $0.25 per share and has a dividend yield of 4.3%. Lincoln National Corporation pays out 17.8% of its earnings in the form of a dividend. Aegon NV pays out 27.5% 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. Lincoln National Corporation has raised its dividend for 6 consecutive years.

Insider and Institutional Ownership

79.9% of Lincoln National Corporation shares are held by institutional investors. Comparatively, 10.6% of Aegon NV shares are held by institutional investors. 1.4% of Lincoln National Corporation shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Lincoln National Corporation and Aegon NV’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lincoln National Corporation 10.85% 10.99% 0.64%
Aegon NV 5.18% 6.73% 0.40%

Volatility and Risk

Lincoln National Corporation has a beta of 1.98, suggesting that its share price is 98% more volatile than the S&P 500. Comparatively, Aegon NV has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Lincoln National Corporation and Aegon NV, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lincoln National Corporation 0 5 4 0 2.44
Aegon NV 0 5 1 0 2.17

Lincoln National Corporation currently has a consensus price target of $73.78, indicating a potential upside of 2.17%. Aegon NV has a consensus price target of $4.80, indicating a potential downside of 17.38%. Given Lincoln National Corporation’s stronger consensus rating and higher possible upside, analysts clearly believe Lincoln National Corporation is more favorable than Aegon NV.

Valuation and Earnings

This table compares Lincoln National Corporation and Aegon NV’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Lincoln National Corporation $13.86 billion 1.15 $2.17 billion $6.52 11.08
Aegon NV $63.63 billion 0.19 $3.20 billion $0.91 6.38

Aegon NV has higher revenue and earnings than Lincoln National Corporation. Aegon NV is trading at a lower price-to-earnings ratio than Lincoln National Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Lincoln National Corporation beats Aegon NV on 14 of the 17 factors compared between the two stocks.

Lincoln National Corporation Company Profile

Lincoln National Corporation is a holding company, which operates insurance and retirement businesses through subsidiary companies. The Company sells a range of wealth protection, accumulation and retirement income products and solutions, through its business segments. The Company operates through four segments: Annuities segment, which offers fixed (including indexed) and variable annuities; Retirement Plan Services segment, which provides employers with retirement plan products and services; Life Insurance segment, which focuses on the creation and protection of wealth through life insurance products, and Group Protection, which offers principally group non-medical insurance products. These products include fixed and indexed annuities, variable annuities, universal life insurance, variable universal life insurance, linked-benefit UL, term life insurance, indexed universal life insurance, employer-sponsored retirement plans and services, and group life, disability and dental.

Aegon NV Company Profile

Aegon N.V. (Aegon) is an international life insurance, pensions and asset management company. The Company’s segments include the Americas, which includes the United States, Mexico and Brazil; the Netherlands; the United Kingdom; Central & Eastern Europe; Spain & Portugal; Asia, and Aegon Asset Management. It offers protection against mortality, morbidity and longevity risks, including traditional and universal life. It offers products with mortality, morbidity, and longevity risks, including traditional and universal life; mortgages; annuity products, and banking products. It offers individual protection products, such as annuities, term insurance, income protection and international/offshore bonds. It has activities in the Czech Republic, Hungary, Poland, Romania, Slovakia and Turkey. It offers life insurance marketed to high-net-worth individuals in Hong Kong and Singapore. It also offers investment products covering third-party customers, insurance-linked solutions.

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