NMI (NASDAQ:NMIH – Get Free Report) and Safety Insurance Group (NASDAQ:SAFT – Get Free Report) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitability.
Institutional and Insider Ownership
94.1% of NMI shares are owned by institutional investors. Comparatively, 81.0% of Safety Insurance Group shares are owned by institutional investors. 2.4% of NMI shares are owned by company insiders. Comparatively, 2.0% of Safety Insurance Group shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of recent recommendations for NMI and Safety Insurance Group, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| NMI | 0 | 1 | 4 | 0 | 2.80 |
| Safety Insurance Group | 0 | 1 | 0 | 0 | 2.00 |
Risk and Volatility
NMI has a beta of 0.64, indicating that its share price is 36% less volatile than the S&P 500. Comparatively, Safety Insurance Group has a beta of 0.22, indicating that its share price is 78% less volatile than the S&P 500.
Valuation & Earnings
This table compares NMI and Safety Insurance Group”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| NMI | $706.44 million | 4.24 | $388.93 million | $4.91 | 8.01 |
| Safety Insurance Group | $1.25 billion | 0.89 | $99.25 million | $6.70 | 11.29 |
NMI has higher earnings, but lower revenue than Safety Insurance Group. NMI is trading at a lower price-to-earnings ratio than Safety Insurance Group, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares NMI and Safety Insurance Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| NMI | 55.05% | 15.78% | 10.64% |
| Safety Insurance Group | 7.85% | 9.64% | 3.54% |
Summary
NMI beats Safety Insurance Group on 11 of the 14 factors compared between the two stocks.
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.
About Safety Insurance Group
Safety Insurance Group, Inc. provides private passenger and commercial automobile, and homeowner insurance in the United States. The company’s private passenger automobile policies offer coverage for bodily injury and property damage to others, no-fault personal injury coverage for the insured/insured’s car occupants, and physical damage coverage for an insured’s own vehicle for collision or other perils. It also provides commercial automobile policies that offer insurance for commercial vehicles used for business purposes, including private passenger-type vehicles, trucks, tractors and trailers, insure individual vehicles, and commercial fleets; and homeowners policies, which provide coverage for homes, condominiums, and apartments for losses to a dwelling and its contents from various perils, and coverage for liability to others arising from ownership or occupancy. In addition, the company offers business owners policies that cover apartments and residential condominiums, restaurants, office condominiums, processing and services businesses, special trade contractors, and wholesalers. Further, it provides personal umbrella policies, which provide personal excess liability coverage over and above the limits of individual automobile, watercraft, and homeowner’s insurance policies; and commercial umbrella, which offers an excess liability product to clients, as well as underwrites dwelling fire insurance for non-owner-occupied residences. Additionally, the company offers inland marine coverage for homeowners and business owner policies, and watercraft coverage for small and medium sized pleasure crafts. It distributes its products through independent agents. The company was formerly known as Safety Holdings Inc and changed its name to Safety Insurance Group, Inc. in April 2002. Safety Insurance Group, Inc. was founded in 1979 and is headquartered in Boston, Massachusetts.
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