W. R. Berkley (NYSE:WRB) and Amerisafe (NASDAQ:AMSF) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, earnings, valuation and risk.

Valuation and Earnings

This table compares W. R. Berkley and Amerisafe’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
W. R. Berkley $7.68 billion 1.22 $549.09 million $2.46 31.15
Amerisafe $375.21 million 3.22 $46.23 million $3.08 20.36

W. R. Berkley has higher revenue and earnings than Amerisafe. Amerisafe is trading at a lower price-to-earnings ratio than W. R. Berkley, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

W. R. Berkley has a beta of 0.85, indicating that its stock price is 15% less volatile than the S&P 500. Comparatively, Amerisafe has a beta of 0.47, indicating that its stock price is 53% less volatile than the S&P 500.

Profitability

This table compares W. R. Berkley and Amerisafe’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
W. R. Berkley 8.64% 9.03% 2.01%
Amerisafe 14.15% 15.21% 4.33%

Dividends

W. R. Berkley pays an annual dividend of $0.60 per share and has a dividend yield of 0.8%. Amerisafe pays an annual dividend of $0.88 per share and has a dividend yield of 1.4%. W. R. Berkley pays out 24.4% of its earnings in the form of a dividend. Amerisafe pays out 28.6% 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. W. R. Berkley has increased its dividend for 8 consecutive years and Amerisafe has increased its dividend for 4 consecutive years.

Institutional & Insider Ownership

71.0% of W. R. Berkley shares are held by institutional investors. 22.2% of W. R. Berkley shares are held by company insiders. Comparatively, 1.8% of Amerisafe shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and price targets for W. R. Berkley and Amerisafe, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
W. R. Berkley 2 3 0 0 1.60
Amerisafe 0 2 1 0 2.33

W. R. Berkley presently has a consensus price target of $75.33, indicating a potential downside of 1.69%. Amerisafe has a consensus price target of $64.00, indicating a potential upside of 2.04%. Given Amerisafe’s stronger consensus rating and higher probable upside, analysts clearly believe Amerisafe is more favorable than W. R. Berkley.

Summary

Amerisafe beats W. R. Berkley on 9 of the 17 factors compared between the two stocks.

W. R. Berkley Company Profile

W. R. Berkley Corporation, an insurance holding company, operates as a commercial lines writer in the United States and internationally. It operates through two segments, Insurance and Reinsurance. The Insurance segment underwrites commercial insurance business, including premises operations, commercial automobile, property, products liability, and professional liability lines. It also provides workers' compensation, property casualty, general liability, and excess and umbrella coverage insurance products, as well as coverages for technology, ambulatory surgery centers, chiropractors, and concierge physicians; accident and health insurance and reinsurance products; insurance for commercial risks; pollution liability and protective coverages to contractors and owners; and liquor liability and inland marine coverage for small to medium-sized insureds. In addition, this segment offers aviation insurance products; directors and officers, and surety risk products, as well as products for life sciences and travel industries; coverage for excess liability, construction wrap-ups, and completed operations; cyber risk solutions; casualty, group life, and crime-related insurance products; personal lines insurance solutions, including home, condo/co-op, and collectibles; automobile, law enforcement, public officials and educator's legal, and employment practices liability, as well as incidental medical insurance products; and at-risk and alternative risk insurance program management services. The Reinsurance segment provides other insurance companies and self-insureds with assistance in managing their net risk through reinsurance on a portfolio basis through treaty reinsurance or on an individual basis through facultative reinsurance. W. R. Berkley Corporation was founded in 1967 and is based in Greenwich, Connecticut.

Amerisafe Company Profile

AMERISAFE, Inc., an insurance holding company, provides workers' compensation insurance in the United States. Its workers' compensation insurance policies provide benefits to injured employees for temporary or permanent disability, death, and medical and hospital expenses. The company serves small to mid-sized employers involved in construction, trucking, logging and lumber, manufacturing, agriculture, maritime, oil and gas, and other industries through agencies. AMERISAFE, Inc. was incorporated in 1985 and is based in DeRidder, Louisiana.

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