ProAssurance (PRA) & HCI Group (HCI) Critical Comparison
ProAssurance (NYSE: PRA) and HCI Group (NYSE:HCI) are both financials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, risk, institutional ownership, earnings, profitability, valuation and analyst recommendations.
Risk & Volatility
ProAssurance has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500. Comparatively, HCI Group has a beta of 2.18, meaning that its stock price is 118% more volatile than the S&P 500.
80.2% of ProAssurance shares are owned by institutional investors. Comparatively, 76.4% of HCI Group shares are owned by institutional investors. 1.8% of ProAssurance shares are owned by insiders. Comparatively, 20.4% of HCI Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
ProAssurance pays an annual dividend of $1.24 per share and has a dividend yield of 2.3%. HCI Group pays an annual dividend of $1.40 per share and has a dividend yield of 4.2%. ProAssurance pays out 45.9% of its earnings in the form of a dividend. HCI Group pays out -84.8% 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. ProAssurance has increased its dividend for 4 consecutive years. HCI Group is clearly the better dividend stock, given its higher yield and lower payout ratio.
This is a breakdown of current ratings and price targets for ProAssurance and HCI Group, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
ProAssurance presently has a consensus price target of $58.33, suggesting a potential upside of 6.74%. HCI Group has a consensus price target of $43.33, suggesting a potential upside of 30.13%. Given HCI Group’s stronger consensus rating and higher possible upside, analysts clearly believe HCI Group is more favorable than ProAssurance.
Valuation & Earnings
This table compares ProAssurance and HCI Group’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|ProAssurance||$870.21 million||3.35||$151.08 million||$2.70||20.24|
|HCI Group||$264.45 million||1.23||$29.02 million||($1.65)||-20.18|
ProAssurance has higher revenue and earnings than HCI Group. HCI Group is trading at a lower price-to-earnings ratio than ProAssurance, indicating that it is currently the more affordable of the two stocks.
This table compares ProAssurance and HCI Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
ProAssurance beats HCI Group on 10 of the 17 factors compared between the two stocks.
ProAssurance Company Profile
ProAssurance Corporation (ProAssurance) is a holding company for property and casualty insurance companies. The Company provides professional liability insurance for healthcare professionals and facilities, professional liability insurance for attorneys, liability insurance for medical technology and life sciences risks, and workers’ compensation insurance. The Company operates through four segments. The Specialty property and casualty segment includes the Company’s professional liability business, and medical technology and life sciences business. The Workers’ compensation segment includes its workers’ compensation business. Lloyd’s Syndicate 1729 (Syndicate 1729) segment includes business of Syndicate 1729, which underwrites risks over a range of property and casualty insurance and reinsurance lines. The Corporate segment includes the Company’s investment operations managed at the corporate level and non-premium revenues generated outside of its insurance entities.
HCI Group Company Profile
HCI Group, Inc. (HCI) is an insurance holding company. The Company operates through four operating divisions: property and casualty insurance, reinsurance, investment real estate and information technology. Its operations include Insurance Operations and Other Operations. Its Insurance Operations include property and casualty insurance, and reinsurance. The Company, through its subsidiary, Homeowners Choice Property & Casualty Insurance Company, Inc. (HCPCI), provides property and casualty insurance to homeowners, condominium owners and tenants on properties located in Florida. HCPCI also offers flood-endorsed and wind-only policies to new and pre-existing Florida customers. Its Other Operations include information technology (IT) and real estate. The Company’s real estate operations consist of multiple properties it owns and operates.
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