Head to Head Comparison: The Hanover Insurance Group (NYSE:THG) vs. Sampo (OTCMKTS:SAXPY)

The Hanover Insurance Group (NYSE:THG) and Sampo (OTCMKTS:SAXPY) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, dividends and risk.

Analyst Recommendations

This is a summary of recent ratings and price targets for The Hanover Insurance Group and Sampo, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
The Hanover Insurance Group	0	3	5	0	2.63
Sampo	0	2	0	1	2.67

The Hanover Insurance Group currently has a consensus price target of $199.00, indicating a potential upside of 17.12%. Given The Hanover Insurance Group’s higher possible upside, research analysts clearly believe The Hanover Insurance Group is more favorable than Sampo.

Risk & Volatility

The Hanover Insurance Group has a beta of 0.33, suggesting that its share price is 67% less volatile than the S&P 500. Comparatively, Sampo has a beta of 0.45, suggesting that its share price is 55% less volatile than the S&P 500.

Earnings & Valuation

This table compares The Hanover Insurance Group and Sampo”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
The Hanover Insurance Group	$6.24 billion	0.97	$426.00 million	$17.29	9.83
Sampo	$2.47 billion	50.05	$1.25 billion	$1.39	16.65

Sampo has lower revenue, but higher earnings than The Hanover Insurance Group. The Hanover Insurance Group is trading at a lower price-to-earnings ratio than Sampo, indicating that it is currently the more affordable of the two stocks.

Dividends

The Hanover Insurance Group pays an annual dividend of $3.80 per share and has a dividend yield of 2.2%. Sampo pays an annual dividend of $0.32 per share and has a dividend yield of 1.4%. The Hanover Insurance Group pays out 22.0% of its earnings in the form of a dividend. Sampo pays out 23.0% 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. The Hanover Insurance Group has raised its dividend for 20 consecutive years. The Hanover Insurance Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares The Hanover Insurance Group and Sampo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
The Hanover Insurance Group	9.71%	21.73%	4.30%
Sampo	N/A	19.32%	5.57%

Institutional & Insider Ownership

86.6% of The Hanover Insurance Group shares are held by institutional investors. Comparatively, 0.0% of Sampo shares are held by institutional investors. 2.5% of The Hanover Insurance Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

The Hanover Insurance Group beats Sampo on 11 of the 18 factors compared between the two stocks.

About The Hanover Insurance Group

The Hanover Insurance Group, Inc., through its subsidiaries, provides various property and casualty insurance products and services in the United States. The company operates through four segments: Core Commercial, Specialty, Personal Lines, and Other. The Commercial Lines segment offers commercial multiple peril, commercial automobile, workers' compensation, and other commercial lines coverage. The Specialty segment provides professional and executive Lines, marine, and surety and other, as well as specialty property and casualty, such as program business, specialty industrial business, excess and surplus business, and specialty general liability coverage. The Personal Lines segment offers personal automobile and homeowner's coverages, as well as other personal coverages, such as personal umbrella, inland marine, fire, personal watercraft, personal cyber, and other miscellaneous coverages. The Other segment markets investment advisory services to institutions, insurance companies, pension funds, and other organizations. The Hanover Insurance Group, Inc. markets its products and services through independent agents and brokers. The company was formerly known as Allmerica Financial Corp. and changed its name to The Hanover Insurance Group, Inc. in December 2005. The Hanover Insurance Group, Inc. was founded in 1852 and is headquartered in Worcester, Massachusetts.

About Sampo

Sampo Oyj, together with its subsidiaries, engages in the provision of non-life insurance products and services in Finland, Sweden, Norway, Denmark, Estonia, Lithuania, Latvia, and the United Kingdom. The company operates through If, Topdanmark, Hastings, Mandatum, and Holding segments. It offers property, casualty, liability, accident, sickness, household, homeowner, motor, travel, marine, aviation, transport, forest, livestock, health, workers compensation, car, van, and bike insurance services, as well as reinsurance services. The company was founded in 1909 and is based in Helsinki, Finland.