National General Holdings Corp (NGHC) and Hartford Financial Services Group (NYSE:HIG) Head to Head Contrast

Hartford Financial Services Group (NYSE: HIG) and National General Holdings Corp (NASDAQ:NGHC) are both financials 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 Hartford Financial Services Group and National General Holdings Corp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hartford Financial Services Group 0 4 5 0 2.56
National General Holdings Corp 0 1 2 0 2.67

Hartford Financial Services Group currently has a consensus target price of $55.38, indicating a potential downside of 1.19%. National General Holdings Corp has a consensus target price of $25.00, indicating a potential upside of 38.97%. Given National General Holdings Corp’s stronger consensus rating and higher probable upside, analysts clearly believe National General Holdings Corp is more favorable than Hartford Financial Services Group.

Profitability

This table compares Hartford Financial Services Group and National General Holdings Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hartford Financial Services Group -0.84% -0.94% -0.07%
National General Holdings Corp 2.13% 7.80% 1.61%

Dividends

Hartford Financial Services Group pays an annual dividend of $0.92 per share and has a dividend yield of 1.6%. National General Holdings Corp pays an annual dividend of $0.16 per share and has a dividend yield of 0.9%. Hartford Financial Services Group pays out 51.4% of its earnings in the form of a dividend. National General Holdings Corp pays out 22.2% 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. Hartford Financial Services Group has raised its dividend for 4 consecutive years. Hartford Financial Services Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Hartford Financial Services Group has a beta of 0.93, suggesting that its share price is 7% less volatile than the S&P 500. Comparatively, National General Holdings Corp has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500.

Institutional and Insider Ownership

90.9% of Hartford Financial Services Group shares are held by institutional investors. Comparatively, 53.4% of National General Holdings Corp shares are held by institutional investors. 1.2% of Hartford Financial Services Group shares are held by company insiders. Comparatively, 3.4% of National General Holdings Corp 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.

Valuation & Earnings

This table compares Hartford Financial Services Group and National General Holdings Corp’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Hartford Financial Services Group $18.55 billion 1.10 $1.28 billion $1.79 31.31
National General Holdings Corp $4.15 billion 0.46 $249.48 million $0.72 24.99

Hartford Financial Services Group has higher revenue and earnings than National General Holdings Corp. National General Holdings Corp is trading at a lower price-to-earnings ratio than Hartford Financial Services Group, indicating that it is currently the more affordable of the two stocks.

Summary

National General Holdings Corp beats Hartford Financial Services Group on 9 of the 17 factors compared between the two stocks.

Hartford Financial Services Group Company Profile

The Hartford Financial Services Group, Inc. is a holding company for insurance and financial services subsidiaries. The Company’s segments include Commercial Lines, which provides workers’ compensation, property, automobile, marine, livestock, liability and umbrella coverages primarily throughout the United States; Personal Lines, which provides automobile, homeowners and personal umbrella coverages to individuals across the United States; Group Benefits, which provides group life, accident and disability coverage, and other products and services; Property & Casualty Other Operations, which includes certain property and casualty operations; Mutual Funds, which provides investment management, administration, product distribution and related services to investors; Talcott Resolution, which consists of the run-off of the Company’s the United States individual and institutional annuity, and Private Placement Life Insurance (PPLI) businesses, and Corporate.

National General Holdings Corp Company Profile

National General Holdings Corp. is a specialty personal lines insurance holding company. Through its subsidiaries, the Company provides a range of insurance products, including personal and commercial automobile, homeowners, umbrella, recreational vehicle, supplemental health, lender-placed and other niche products. It operates through two segments: Property and Casualty (P&C) and Accident and Health (A&H). Its P&C segment offers its P&C insurance products through a network of agents, a number of affinity partners and through direct-response marketing programs. Its A&H segment provides accident and non-major medical health insurance products targeting its existing P&C policyholders and the anticipated market of employed persons who are uninsured or underinsured. The P&C segment operates its business through three distribution channels: agency, affinity and direct. The A&H segment provides supplemental accident and health insurance products.

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