NFP (NFP) versus National General (NASDAQ:NGHC) Critical Survey

National General (NASDAQ: NGHC) and NFP (NYSE:NFP) are both multiline insurance & brokers – nec companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, dividends, earnings, profitability, valuation and institutional ownership.

Profitability

This table compares National General and NFP’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
National General 2.62% 7.30% 1.44%
NFP N/A N/A N/A

Valuation and Earnings

This table compares National General and NFP’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
National General $3.55 billion 0.59 $172.21 million $0.97 20.25
NFP N/A N/A N/A $0.66 N/A

National General has higher revenue and earnings than NFP. NFP is trading at a lower price-to-earnings ratio than National General, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

45.6% of National General shares are owned by institutional investors. 3.4% of National General shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for National General and NFP, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
National General 0 1 3 0 2.75
NFP 0 0 0 0 N/A

National General currently has a consensus price target of $27.00, suggesting a potential upside of 37.47%.

Dividends

National General pays an annual dividend of $0.16 per share and has a dividend yield of 0.8%. NFP does not pay a dividend. National General pays out 16.5% of its earnings in the form of a dividend.

Summary

National General beats NFP on 9 of the 10 factors compared between the two stocks.

National General Company Profile

National General Holdings Corp. is a specialty personal lines insurance holding company. Through its subsidiaries, the Company provides a range of insurance products, including personal and commercial automobile, homeowners, umbrella, recreational vehicle, supplemental health, lender-placed and other niche products. It operates through two segments: Property and Casualty (P&C) and Accident and Health (A&H). Its P&C segment offers its P&C insurance products through a network of agents, a number of affinity partners and through direct-response marketing programs. Its A&H segment provides accident and non-major medical health insurance products targeting its existing P&C policyholders and the anticipated market of employed persons who are uninsured or underinsured. The P&C segment operates its business through three distribution channels: agency, affinity and direct. The A&H segment provides supplemental accident and health insurance products.

NFP Company Profile

National Financial Partners Corp. (NFP) and its benefits, insurance and wealth management businesses provide a range of advisory and brokerage services to the Company’s clients. NFP serves corporate and high net worth individual clients throughout the United States and in Canada, with a focus on the middle market and entrepreneurs. The Company operates in three segments: the Corporate Client Group (the CCG), the Individual Client Group (the ICG) and the Advisor Services Group (the ASG). The CCG is a corporate benefits advisor in the middle market, offering independent solutions. The ICG is in the delivery of independent life insurance, annuities, long term care and wealth transfer solutions for high net worth individuals. The ASG, including NFP Securities, Inc. (NFPSI), is an independent broker-dealer and registered investment advisor. In July 2013, National Financial Partners Corp announced the completion of its acquisition by a controlled affiliate of Madison Dearborn Partners, LLC.

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