NMI (NASDAQ:NMIH) versus Kingsway Financial Services (NYSE:KFS) Financial Contrast

Kingsway Financial Services (NYSE:KFS) and NMI (NASDAQ:NMIH) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, earnings, valuation, profitability, analyst recommendations and risk.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Kingsway Financial Services	-8.55%	-76.94%	-5.18%
NMI	55.02%	16.08%	10.79%

Volatility & Risk

Kingsway Financial Services has a beta of 0.2, meaning that its stock price is 80% less volatile than the S&P 500. Comparatively, NMI has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500.

Earnings & Valuation

This table compares Kingsway Financial Services and NMI”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kingsway Financial Services	$109.38 million	3.33	-$9.27 million	($0.36)	-34.91
NMI	$650.97 million	4.78	$360.11 million	$4.78	8.47

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

Analyst Recommendations

This is a summary of current ratings and target prices for Kingsway Financial Services and NMI, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kingsway Financial Services	1	0	0	0	1.00
NMI	0	2	4	0	2.67

NMI has a consensus price target of $42.40, suggesting a potential upside of 4.74%. Given NMI’s stronger consensus rating and higher possible upside, analysts clearly believe NMI is more favorable than Kingsway Financial Services.

Insider & Institutional Ownership

72.4% of Kingsway Financial Services shares are owned by institutional investors. Comparatively, 94.1% of NMI shares are owned by institutional investors. 53.8% of Kingsway Financial Services shares are owned by company insiders. Comparatively, 3.0% of NMI shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

NMI beats Kingsway Financial Services on 13 of the 14 factors compared between the two stocks.

About Kingsway Financial Services

Kingsway Financial Services Inc., through its subsidiaries, engages in the extended warranty and business services in the United States. The company operates through two segments, Extended Warranty 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 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, as well as after-market vehicle protection services. 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, Securities and Exchange Commission reporting, and international consolidation services; human resources, workforce management, and compliance support services; and advisory services. This segment also provides financial executive services for project and interim staffing engagements; search services for permanent placements; healthcare staffing services to acute healthcare facilities for short-term and day-to-day needs of hospitals; software products for the management needs of all types of shared-ownership properties; and fully managed outsourced cardiac telemetry services, as well as provides mobile monitors to the hospitals. The company offers its products and services through credit unions and dealers. Kingsway Financial Services Inc. was incorporated in 1989 and is headquartered in Chicago, Illinois.

About NMI

NMI Holdings, Inc. provides private mortgage guaranty insurance services in the United States. The company offers mortgage insurance services, such as primary and pool insurance; and outsourced loan review services to mortgage loan originators. It serves national and regional mortgage banks, money center banks, credit unions, community banks, builder-owned mortgage lenders, internet-sourced lenders, and other non-bank lenders. The company was incorporated in 2011 and is headquartered in Emeryville, California.