Investors Title (NASDAQ:ITIC – Get Free Report) and United Fire Group (NASDAQ:UFCS – Get Free Report) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.
Dividends
Investors Title pays an annual dividend of $1.84 per share and has a dividend yield of 0.7%. United Fire Group pays an annual dividend of $0.64 per share and has a dividend yield of 1.8%. Investors Title pays out 9.7% of its earnings in the form of a dividend. United Fire Group pays out 15.1% 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.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Investors Title and United Fire Group, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Investors Title | 0 | 0 | 1 | 0 | 3.00 |
| United Fire Group | 0 | 1 | 2 | 1 | 3.00 |
Valuation and Earnings
This table compares Investors Title and United Fire Group”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Investors Title | $258.30 million | 1.90 | $31.07 million | $19.01 | 13.66 |
| United Fire Group | $1.25 billion | 0.73 | $61.96 million | $4.24 | 8.49 |
United Fire Group has higher revenue and earnings than Investors Title. United Fire Group is trading at a lower price-to-earnings ratio than Investors Title, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
41.4% of Investors Title shares are held by institutional investors. Comparatively, 62.7% of United Fire Group shares are held by institutional investors. 26.4% of Investors Title shares are held by insiders. Comparatively, 6.1% of United Fire Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Volatility and Risk
Investors Title has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500. Comparatively, United Fire Group has a beta of 0.47, meaning that its stock price is 53% less volatile than the S&P 500.
Profitability
This table compares Investors Title and United Fire Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Investors Title | 13.15% | 13.72% | 10.47% |
| United Fire Group | 8.22% | 13.64% | 3.16% |
Summary
Investors Title beats United Fire Group on 9 of the 16 factors compared between the two stocks.
About Investors Title
Investors Title Company engages in the issuance of residential and commercial title insurance for residential, institutional, commercial, and industrial properties. The company underwrites land title insurance for owners and mortgagees as a primary insurer; and assumes the reinsurance of title insurance risks from other title insurance companies. It offers services in connection with tax-deferred exchanges of like-kind property; acts as a qualified intermediary in tax-deferred exchanges of property; coordinates the exchange aspects of the real estate transaction, such as drafting standard exchange documents, holding the exchange funds between the sale of the old property and the purchase of the new property, and accepting the formal identification of the replacement property. In addition, it serves as an exchange accommodation titleholder for accomplishing reverse exchanges when the taxpayers decide to acquire replacement property before selling the relinquished property. Further, the company offers investment management and trust services to individuals, companies, banks, and trusts; and consulting and management services to clients to start and operate a title insurance agency. It issues title insurance policies directly and through a network of agents in 22 states and the District of Columbia, primarily in the eastern half of the United States. Investors Title Company was founded in 1972 and is headquartered in Chapel Hill, North Carolina.
About United Fire Group
United Fire Group, Inc., together with its subsidiaries, provides property and casualty insurance for individuals and businesses in the United States. The company offers commercial and personal lines of property and casualty insurance; and reinsurance coverage for property and casualty insurance. Its commercial lines include fire and allied lines, other liability, automobile, workers’ compensation, fidelity and surety coverage, and other insurance products; and personal lines comprise automobile, and fire and allied lines coverage, including homeowners, as well as provides assumed reinsurance products. The company sells its products through a network of independent agencies. United Fire Group, Inc. was incorporated in 1946 and is headquartered in Cedar Rapids, Iowa.
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