Kingstone Companies (NASDAQ:KINS) versus First American Financial (NYSE:FAF) Head-To-Head Contrast

Kingstone Companies (NASDAQ:KINS) and First American Financial (NYSE:FAF) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, analyst recommendations, earnings, dividends, risk, institutional ownership and valuation.

Volatility and Risk

Kingstone Companies has a beta of 0.52, indicating that its stock price is 48% less volatile than the S&P 500. Comparatively, First American Financial has a beta of 1.24, indicating that its stock price is 24% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations for Kingstone Companies and First American Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kingstone Companies	0	0	0	0	0.00
First American Financial	0	1	3	0	2.75

First American Financial has a consensus price target of $75.00, indicating a potential upside of 16.41%. Given First American Financial’s stronger consensus rating and higher probable upside, analysts clearly believe First American Financial is more favorable than Kingstone Companies.

Earnings and Valuation

This table compares Kingstone Companies and First American Financial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kingstone Companies	$155.14 million	1.26	$18.36 million	$2.00	6.99
First American Financial	$6.13 billion	1.07	$131.10 million	$1.81	35.60

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

Dividends

Kingstone Companies pays an annual dividend of $0.20 per share and has a dividend yield of 1.4%. First American Financial pays an annual dividend of $2.16 per share and has a dividend yield of 3.4%. Kingstone Companies pays out 10.0% of its earnings in the form of a dividend. First American Financial pays out 119.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. First American Financial has raised its dividend for 15 consecutive years. First American Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

14.9% of Kingstone Companies shares are owned by institutional investors. Comparatively, 89.1% of First American Financial shares are owned by institutional investors. 5.1% of Kingstone Companies shares are owned by insiders. Comparatively, 3.7% of First American Financial shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Kingstone Companies and First American Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kingstone Companies	14.84%	36.24%	6.83%
First American Financial	2.90%	10.41%	3.33%

Summary

First American Financial beats Kingstone Companies on 10 of the 17 factors compared between the two stocks.

About Kingstone Companies

Kingstone Companies, Inc., through its subsidiary, provides property and casualty insurance products to individuals in the United States. It offers personal line of insurance products, such as homeowners and dwelling fire, cooperative/condominiums, renters, and personal umbrella policies. The company also provides for-hire vehicle physical damage only policies for livery and car service vehicles and taxicabs; and canine legal liability policies. In addition, it offers reinsurance products. The company underwrites its products through retail and wholesale agents and brokers. The company was formerly known as DCAP Group, Inc. and changed its name to Kingstone Companies, Inc. in July 2009. Kingstone Companies, Inc. was founded in 1886 and is headquartered in Kingston, New York.

About First American Financial

First American Financial Corporation, through its subsidiaries, provides financial services. It operates through Title Insurance and Services, and Home Warranty segments. The Title Insurance and Services segment issues title insurance policies on residential and commercial property, as well as offers related products and services internationally. This segment also provides closing and/or escrow services; products, services, and solutions to mitigate risk or otherwise facilitate real estate transactions; and appraisals and other valuation-related products and services, lien release and document custodial services, warehouse lending services, default-related products and services, document generation services, mortgage loans subservicing, and related products and services, as well as banking, trust, and wealth management services. In addition, it accommodates tax-deferred exchanges of real estate; and maintains, manages, and provides access to title plant data and records. This segment offers its products through a network of direct operations and agents in various states and in the District of Columbia, as well as in Canada, the United Kingdom, Australia, New Zealand, South Korea, and internationally. The Home Warranty segment provides home warranty products, including residential service contracts that cover residential systems, such as heating and air conditioning systems, and various appliances against failures that occur as the result of normal usage during the coverage period. This segment operates in various states and the District of Columbia. The company was founded in 1889 and is headquartered in Santa Ana, California.