W. R. Berkley (NYSE:WRB) and Tokio Marine (OTCMKTS:TKOMY) are both large-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, analyst recommendations, valuation, earnings, risk, institutional ownership and profitability.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for W. R. Berkley and Tokio Marine, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
W. R. Berkley 2 4 1 0 1.86
Tokio Marine 0 0 0 0 N/A

W. R. Berkley currently has a consensus target price of $64.23, indicating a potential downside of 10.69%. Given W. R. Berkley’s higher possible upside, analysts clearly believe W. R. Berkley is more favorable than Tokio Marine.

Profitability

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

Net Margins Return on Equity Return on Assets
W. R. Berkley 8.81% 10.55% 2.36%
Tokio Marine 5.00% 8.11% 1.32%

Volatility and Risk

W. R. Berkley has a beta of 0.69, suggesting that its share price is 31% less volatile than the S&P 500. Comparatively, Tokio Marine has a beta of 0.54, suggesting that its share price is 46% less volatile than the S&P 500.

Dividends

W. R. Berkley pays an annual dividend of $0.44 per share and has a dividend yield of 0.6%. Tokio Marine pays an annual dividend of $1.34 per share and has a dividend yield of 2.5%. W. R. Berkley pays out 16.5% of its earnings in the form of a dividend. Tokio Marine pays out 34.6% 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 raised its dividend for 9 consecutive years.

Institutional and Insider Ownership

70.7% of W. R. Berkley shares are owned by institutional investors. Comparatively, 0.1% of Tokio Marine shares are owned by institutional investors. 21.7% of W. R. Berkley shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares W. R. Berkley and Tokio Marine’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
W. R. Berkley $7.69 billion 1.71 $640.75 million $2.67 26.94
Tokio Marine $49.73 billion 0.77 $2.49 billion $3.87 13.98

Tokio Marine has higher revenue and earnings than W. R. Berkley. Tokio Marine 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.

Summary

W. R. Berkley beats Tokio Marine on 12 of the 16 factors compared between the two stocks.

About W. R. Berkley

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, professional 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 coverages to contractors, consultants, and owners; and liquor liability and inland marine coverage for small to medium-sized insureds. In addition, this segment offers 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 headquartered in Greenwich, Connecticut.

About Tokio Marine

Tokio Marine Holdings, Inc., together with its subsidiaries, engages in non-life and life insurance, international insurance, and financial and general businesses worldwide. The company provides business, fire, Internet and mobile, rental housing, and natural catastrophe risk insurance services, as well as insurance for retail and corporate fields. It also provides property investment, insurance agency and risk consulting, human resource, in-home care and nursing care information, healthcare/medical, call center, and real estate-related services. Tokio Marine Holdings, Inc. serves individuals, small to medium sized non-profit organizations, schools, or churches. The company was formerly known as Millea Holdings, Inc. and changed its name to Tokio Marine Holdings, Inc. in 2008. Tokio Marine Holdings, Inc. was founded in 1879 and is headquartered in Tokyo, Japan.

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