Emergent Capital (OTCMKTS: EMGC) and National Western Life Group (NASDAQ:NWLI) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, valuation, risk, earnings, dividends, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and target prices for Emergent Capital and National Western Life Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Emergent Capital 0 0 1 0 3.00
National Western Life Group 0 0 0 0 N/A

Profitability

This table compares Emergent Capital and National Western Life Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Emergent Capital -42.49% -12.80% -3.98%
National Western Life Group 11.31% 4.75% 0.70%

Dividends

National Western Life Group pays an annual dividend of $0.36 per share and has a dividend yield of 0.1%. Emergent Capital does not pay a dividend. National Western Life Group pays out 1.3% of its earnings in the form of a dividend.

Institutional and Insider Ownership

0.3% of Emergent Capital shares are held by institutional investors. Comparatively, 79.7% of National Western Life Group shares are held by institutional investors. 33.3% of Emergent Capital shares are held by company insiders. Comparatively, 1.0% of National Western Life Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Emergent Capital and National Western Life Group’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Emergent Capital $1.12 million 59.86 -$49.68 million N/A N/A
National Western Life Group $682.37 million 1.71 $100.89 million $26.70 12.01

National Western Life Group has higher revenue and earnings than Emergent Capital.

Summary

National Western Life Group beats Emergent Capital on 7 of the 11 factors compared between the two stocks.

About Emergent Capital

Emergent Capital, Inc., formerly Imperial Holdings, Inc., is a specialty finance company that invests in asset classes, primarily life settlements. The Company, through its subsidiary companies, owns a portfolio of approximately 630 life insurance policies (life settlements). The Company purchases individual policies and portfolios of life insurance policies and manages those assets based on actuarial and market data. The Company provides customized liquidity solutions to owners of illiquid financial assets in two markets, which include life finance and structured settlements. The Company focuses on lending to outright purchases of portfolios, to tertiary trades, as well as individual secondary market purchases. The Company invests in short and long-term life settlement investments.

About National Western Life Group

National Western Life Insurance Company (National Western) is a stock life insurance company. The Company operates in two segments: Domestic Insurance Operations and International Insurance Operations. The products marketed under domestic insurance operations are annuities, universal life insurance and traditional life insurance, which include both term and whole life products. National Western’s international operations focus on foreign nationals in upper socioeconomic classes. The Company provides life insurance products for the savings and protection needs of approximately 126,700 policyholders and for the asset accumulation and retirement needs of 139,100 annuity contract holders. National Western offers a portfolio of individual whole life, universal life and term insurance plans, and annuities, including supplementary riders.

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