Analyzing Anthem (ANTM) and Trupanion (TRUP)

Anthem (NYSE: ANTM) and Trupanion (NASDAQ:TRUP) are both medical companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, analyst recommendations, risk, profitability, dividends and earnings.

Dividends

Anthem pays an annual dividend of $3.00 per share and has a dividend yield of 1.3%. Trupanion does not pay a dividend. Anthem pays out 24.9% of its earnings in the form of a dividend. Anthem has raised its dividend for 3 consecutive years.



Risk & Volatility

Anthem has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Trupanion has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500.

Earnings & Valuation

This table compares Anthem and Trupanion’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Anthem $90.04 billion 0.66 $3.84 billion $12.04 19.31
Trupanion $242.67 million 3.56 -$1.50 million ($0.07) -395.29

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

Institutional & Insider Ownership

88.3% of Anthem shares are owned by institutional investors. Comparatively, 74.8% of Trupanion shares are owned by institutional investors. 0.3% of Anthem shares are owned by company insiders. Comparatively, 31.2% of Trupanion shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Anthem and Trupanion’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Anthem 4.60% 12.77% 4.82%
Trupanion -0.58% -6.54% -2.98%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Anthem and Trupanion, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Anthem 0 4 14 0 2.78
Trupanion 0 1 6 0 2.86

Anthem presently has a consensus price target of $248.77, indicating a potential upside of 6.97%. Trupanion has a consensus price target of $36.17, indicating a potential upside of 30.71%. Given Trupanion’s stronger consensus rating and higher probable upside, analysts plainly believe Trupanion is more favorable than Anthem.

Summary

Anthem beats Trupanion on 12 of the 17 factors compared between the two stocks.

About Anthem

Anthem, Inc., through its subsidiaries, operates as a health benefits company in the United States. It operates through three segments: Commercial & Specialty Business, Government Business, and Other. The company offers a spectrum of network-based managed care health benefit plans to large and small group, individual, Medicaid, and Medicare markets. Its managed care plans include preferred provider organizations; health maintenance organizations; point-of-service plans; traditional indemnity plans and other hybrid plans, such as consumer-driven health plans; and hospital only and limited benefit products. The company also provides a range of managed care services to self-funded customers, including claims processing, underwriting, stop loss insurance, actuarial services, provider network access, medical cost management, disease management, wellness programs, and other administrative services. In addition, it offers an array of specialty and other insurance products and services, such as dental, vision, life and disability insurance benefits, radiology benefit management, and analytics-driven personal health care guidance; and Medicare administrative services. Further, the company provides services to the federal government in connection with the Federal Employee Program; and operates as a licensee of the Blue Cross and Blue Shield Association. As of December 31, 2017, it served 40.2 million medical members through its affiliated health plans. The company was formerly known as WellPoint, Inc. and changed its name to Anthem, Inc. in December 2014. Anthem, Inc. was founded in 1944 and is headquartered in Indianapolis, Indiana.

About Trupanion

Trupanion, Inc., together with its subsidiaries, provides medical insurance for cats and dogs on monthly subscription basis in the United States, Canada, and Puerto Rico. The company operates through Subscription Business and Other Business segments. It serves pet owners and veterinarians through third-party referrals and online member acquisition channels. The company was formerly known as Vetinsurance International, Inc. changed its name to Trupanion, Inc. in 2013. Trupanion, Inc. was founded in 2000 and is headquartered in Seattle, Washington.

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