Comparing The Travelers Companies (TRV) and United Fire Group (UFCS)
The Travelers Companies (NYSE: TRV) and United Fire Group (NASDAQ:UFCS) are both financials companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, institutional ownership, profitability and earnings.
This is a summary of recent recommendations and price targets for The Travelers Companies and United Fire Group, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|The Travelers Companies||3||7||7||0||2.24|
|United Fire Group||0||2||1||0||2.33|
The Travelers Companies presently has a consensus price target of $127.56, indicating a potential downside of 1.88%. United Fire Group has a consensus price target of $46.33, indicating a potential downside of 3.63%. Given The Travelers Companies’ higher possible upside, equities research analysts plainly believe The Travelers Companies is more favorable than United Fire Group.
The Travelers Companies pays an annual dividend of $2.88 per share and has a dividend yield of 2.2%. United Fire Group pays an annual dividend of $1.12 per share and has a dividend yield of 2.3%. The Travelers Companies pays out 33.3% of its earnings in the form of a dividend. United Fire Group pays out 177.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. The Travelers Companies has raised its dividend for 8 consecutive years.
Institutional & Insider Ownership
78.1% of The Travelers Companies shares are held by institutional investors. Comparatively, 58.3% of United Fire Group shares are held by institutional investors. 0.8% of The Travelers Companies shares are held by company insiders. Comparatively, 5.8% of United Fire Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This table compares The Travelers Companies and United Fire Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|The Travelers Companies||8.56%||9.87%||2.28%|
|United Fire Group||1.49%||1.32%||0.30%|
Volatility and Risk
The Travelers Companies has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500. Comparatively, United Fire Group has a beta of 0.71, suggesting that its stock price is 29% less volatile than the S&P 500.
Earnings and Valuation
This table compares The Travelers Companies and United Fire Group’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|The Travelers Companies||$27.63 billion||1.29||$3.01 billion||$8.65||15.03|
|United Fire Group||$1.14 billion||1.05||$49.90 million||$0.63||76.32|
The Travelers Companies has higher revenue and earnings than United Fire Group. The Travelers Companies is trading at a lower price-to-earnings ratio than United Fire Group, indicating that it is currently the more affordable of the two stocks.
The Travelers Companies beats United Fire Group on 13 of the 17 factors compared between the two stocks.
About The Travelers Companies
The Travelers Companies, Inc. is a holding company. The Company’s segments include Business and International Insurance; Bond & Specialty Insurance, and Personal Insurance. Through its subsidiaries, it provides commercial and personal property and casualty insurance products and services. The Business and International Insurance segment offers property and casualty insurance and insurance related services to its clients, in the United States and in Canada, as well as in the United Kingdom, the Republic of Ireland, Brazil and throughout other parts of the world. The Bond & Specialty Insurance segment provides surety, fidelity, management liability, professional liability, and other property and casualty coverages and related risk management services to a range of primarily domestic customers, utilizing various degrees of financially-based underwriting approaches. The Personal Insurance segment writes a range of property and casualty insurance covering individuals’ personal risks.
About United Fire Group
United Fire Group, Inc., formerly United Fire & Casualty Company, is engaged in the business of writing property and casualty insurance and life insurance and selling annuities. The Company operates in two segments: property and casualty insurance, and life insurance. The Company’s property and casualty insurance segment consists of commercial lines insurance, including surety bonds, personal lines insurance and assumed insurance. Its life insurance segment consists of deferred and immediate annuities, universal life insurance products and traditional life insurance products. Its life insurance segment consists solely of the operations of United Life Insurance Company. On February 1, 2012, the Company completed a holding company reorganization of United Fire Group, Inc., United Fire & Casualty Company and UFC MergeCo, Inc. On March 28, 2011, the Company acquired Mercer Insurance Group, Inc. (Mercer Insurance Group).
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