Head to Head Review: MetLife (NYSE:MET) and Allstate (NYSE:ALL)

MetLife (NYSE:MET) and Allstate (NYSE:ALL) are both large-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, valuation, dividends, risk, analyst recommendations and earnings.

Institutional & Insider Ownership

95.0% of MetLife shares are held by institutional investors. Comparatively, 76.5% of Allstate shares are held by institutional investors. 0.4% of MetLife shares are held by insiders. Comparatively, 1.5% of Allstate shares are held by 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.

Volatility & Risk

MetLife has a beta of 0.78, indicating that its stock price is 22% less volatile than the S&P 500. Comparatively, Allstate has a beta of 0.13, indicating that its stock price is 87% less volatile than the S&P 500.

Dividends

MetLife pays an annual dividend of $2.37 per share and has a dividend yield of 2.5%. Allstate pays an annual dividend of $4.32 per share and has a dividend yield of 1.9%. MetLife pays out 45.4% of its earnings in the form of a dividend. Allstate pays out 8.6% 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. MetLife has raised its dividend for 12 consecutive years and Allstate has raised its dividend for 15 consecutive years.

Valuation and Earnings

This table compares MetLife and Allstate”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MetLife	$77.08 billion	0.80	$3.38 billion	$5.22	18.40
Allstate	$67.69 billion	0.84	$10.28 billion	$50.08	4.47

Allstate has lower revenue, but higher earnings than MetLife. Allstate is trading at a lower price-to-earnings ratio than MetLife, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares MetLife and Allstate’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MetLife	4.57%	23.39%	0.89%
Allstate	18.97%	41.64%	9.82%

Analyst Recommendations

This is a summary of current ratings and recommmendations for MetLife and Allstate, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MetLife	0	0	12	0	3.00
Allstate	4	8	6	2	2.30

MetLife presently has a consensus target price of $106.15, suggesting a potential upside of 10.51%. Allstate has a consensus target price of $262.53, suggesting a potential upside of 17.27%. Given Allstate’s higher possible upside, analysts clearly believe Allstate is more favorable than MetLife.

Summary

Allstate beats MetLife on 11 of the 18 factors compared between the two stocks.

About MetLife

MetLife, Inc., a financial services company, provides insurance, annuities, employee benefits, and asset management services worldwide. It operates through six segments: Retirement and Income Solutions; Group Benefits; Asia; Latin America; Europe, the Middle East and Africa; and MetLife Holdings. The company offers life, dental, group short-and long-term disability, individual disability, pet insurance, accidental death and dismemberment, vision, and accident and health coverages, as well as prepaid legal plans; administrative services-only arrangements to employers; and general and separate account, and synthetic guaranteed interest contracts, as well as private floating rate funding agreements. It also provides pension risk transfers, institutional income annuities, structured settlements, and capital markets investment products; and other products and services, such as life insurance products and funding agreements for funding postretirement benefits, as well as company, bank, or trust-owned life insurance used to finance nonqualified benefit programs for executives. In addition, it provides fixed, indexed-linked, and variable annuities; pension products; regular savings products; whole and term life, endowments, universal and variable life, and group life products; longevity reinsurance solutions; credit insurance products; and protection against long-term health care services. MetLife, Inc. was incorporated in 1999 and is based in New York, New York.

About Allstate

The Allstate Corporation, together with its subsidiaries, provides property and casualty, and other insurance products in the United States and Canada. It operates in five segments: Allstate Protection; Protection Services; Allstate Health and Benefits; Run-off Property-Liability; and Corporate and Other segments. The Allstate Protection segment offers private passenger auto and homeowners insurance; other personal lines products; and commercial lines products through agents, contact centers, and online. The Protection Services segment provides consumer product protection; protection and insurance products, including vehicle service contracts, guaranteed asset protection, road hazard tire and wheel, and paintless dent repair protection; and roadside assistance, device and mobile data collection services, and analytic solutions using automotive telematics information, as well as identity theft protection and remediation services. This segment also offers its products under various brands, including Allstate Protection Plans, Allstate Dealer Services, Allstate Roadside, Arity, Avail, and Allstate Identity Protection. The Allstate Health and Benefits segment provides life, accident, critical illness, short-term disability, and other health insurance products; stop-loss and fully insured group health products to employers; and short-term medical and medicare supplement insurance to individuals. The Run-off Property-Liability segment offers property and casualty insurance coverage that primarily relates to policies written during the 1960s through the mid-1980s. The Corporate and Other segment provides debt services, as well as non-insurance operations. It sells its products through agents, independent agents, call and contact centers, retailers, direct to consumer, wholesale partners, and affinity groups, as well as through online and mobile applications. The Allstate Corporation was founded in 1931 and is headquartered in Northbrook, Illinois.