Analyzing Travelers Companies (NYSE:TRV) and Kingsway Financial Services (NYSE:KFS)

Kingsway Financial Services (NYSE:KFSGet Rating) and Travelers Companies (NYSE:TRVGet Rating) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, analyst recommendations, valuation, dividends and profitability.

Risk and Volatility

Kingsway Financial Services has a beta of -0.17, meaning that its share price is 117% less volatile than the S&P 500. Comparatively, Travelers Companies has a beta of 0.7, meaning that its share price is 30% less volatile than the S&P 500.

Institutional and Insider Ownership

74.6% of Kingsway Financial Services shares are held by institutional investors. Comparatively, 80.9% of Travelers Companies shares are held by institutional investors. 56.4% of Kingsway Financial Services shares are held by insiders. Comparatively, 1.1% of Travelers Companies shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Kingsway Financial Services and Travelers Companies’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Kingsway Financial Services $91.77 million 1.48 -$340,000.00 $0.00 -563,000.00
Travelers Companies $34.82 billion 1.18 $3.66 billion $15.80 10.83

Travelers Companies has higher revenue and earnings than Kingsway Financial Services. Kingsway Financial Services is trading at a lower price-to-earnings ratio than Travelers Companies, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and price targets for Kingsway Financial Services and Travelers Companies, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kingsway Financial Services 0 0 0 0 N/A
Travelers Companies 2 8 3 0 2.08

Travelers Companies has a consensus target price of $178.50, suggesting a potential upside of 4.35%. Given Travelers Companies’ higher possible upside, analysts clearly believe Travelers Companies is more favorable than Kingsway Financial Services.

Profitability

This table compares Kingsway Financial Services and Travelers Companies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kingsway Financial Services 0.43% 167.08% 2.63%
Travelers Companies 11.18% 13.78% 3.22%

Summary

Travelers Companies beats Kingsway Financial Services on 9 of the 12 factors compared between the two stocks.

About Kingsway Financial Services (Get Rating)

Kingsway Financial Services Inc., through its subsidiaries, engages in the extended warranty business services, asset management, and real estate businesses. The company operates through three segments: Extended Warranty, Leased Real Estate, and Kingsway Search Xcelerator. The Extended Warranty segment markets, sells, and administers vehicle service agreements and related products for new and used automobiles, motorcycles, and ATVs. This segment also sells new home warranty products, as well as offers uninsured warrant administration services to homebuilders and homeowners; markets and distributes warranty products to manufacturers, distributors, and installers of heating, ventilation and air conditioning, standby generator, commercial LED lighting, and commercial refrigeration equipment; and provides equipment breakdown and maintenance support services to companies. The Leased Real Estate segment owns a parcel of real property consisting of approximately 192 acres located in the State of Texas. The Kingsway Search Xcelerator offers outsourced finance and human resources consulting services, including operational accounting, such as bookkeeping, accounting, financial reporting, and analysis and strategic finance services; technical accounting comprising initial public offerings, SEC reporting, and international consolidation services; human resources, workforce management, and compliance support services; and advisory services. The company offers its products and services through credit unions, dealers, homebuilders, and consumers. Kingsway Financial Services Inc. was incorporated in 1989 and is based in Itasca, Illinois.

About Travelers Companies (Get Rating)

The Travelers Companies, Inc., through its subsidiaries, provides a range of commercial and personal property, and casualty insurance products and services to businesses, government units, associations, and individuals in the United states and internationally. The company operates through three segments: Business Insurance, Bond & Specialty Insurance, and Personal Insurance. The Business Insurance segment offers workers' compensation, commercial automobile and property, general liability, commercial multi-peril, employers' liability, public and product liability, professional indemnity, marine, aviation, onshore and offshore energy, construction, terrorism, personal accident, and kidnap and ransom insurance products. This segment operates through select accounts, which serve small businesses; commercial accounts that serve mid-sized businesses; national accounts, which serve large companies; and national property and other that serve large and mid-sized customers, commercial trucking industry, and agricultural businesses, as well as markets and distributes its products through brokers, wholesale agents, and program managers. The Bond & Specialty Insurance segment provides surety, fidelity, management and professional liability, and other property and casualty coverages and related risk management services through independent agencies and brokers. The Personal Insurance segment offers property and casualty insurance covering personal risks, primarily automobile and homeowners insurance to individuals through independent agencies and brokers. The Travelers Companies, Inc. was founded in 1853 and is based in New York, New York.

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