AmTrust Financial Services (AFSI) & Its Competitors Critical Comparison

AmTrust Financial Services (NASDAQ: AFSI) is one of 73 publicly-traded companies in the “Fire, marine, & casualty insurance” industry, but how does it contrast to its competitors? We will compare AmTrust Financial Services to related businesses based on the strength of its profitability, analyst recommendations, valuation, risk, earnings, institutional ownership and dividends.

Risk & Volatility

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AmTrust Financial Services has a beta of 1.28, suggesting that its share price is 28% more volatile than the S&P 500. Comparatively, AmTrust Financial Services’ competitors have a beta of 0.78, suggesting that their average share price is 22% less volatile than the S&P 500.

Profitability

This table compares AmTrust Financial Services and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AmTrust Financial Services -5.67% -3.33% -0.36%
AmTrust Financial Services Competitors 2.83% 0.58% -0.16%

Valuation & Earnings

This table compares AmTrust Financial Services and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
AmTrust Financial Services $5.96 billion -$348.88 million 4.79
AmTrust Financial Services Competitors $12.77 billion $1.43 billion 21.14

AmTrust Financial Services’ competitors have higher revenue and earnings than AmTrust Financial Services. AmTrust Financial Services is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Dividends

AmTrust Financial Services pays an annual dividend of $0.68 per share and has a dividend yield of 5.4%. AmTrust Financial Services pays out 25.8% of its earnings in the form of a dividend. As a group, “Fire, marine, & casualty insurance” companies pay a dividend yield of 1.5% and pay out 81.8% of their earnings in the form of a dividend. AmTrust Financial Services is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for AmTrust Financial Services and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AmTrust Financial Services 0 6 0 0 2.00
AmTrust Financial Services Competitors 474 1900 1836 83 2.36

AmTrust Financial Services currently has a consensus target price of $14.17, indicating a potential upside of 12.08%. As a group, “Fire, marine, & casualty insurance” companies have a potential upside of 5.57%. Given AmTrust Financial Services’ higher probable upside, equities research analysts plainly believe AmTrust Financial Services is more favorable than its competitors.

Insider & Institutional Ownership

29.3% of AmTrust Financial Services shares are held by institutional investors. Comparatively, 60.9% of shares of all “Fire, marine, & casualty insurance” companies are held by institutional investors. 50.8% of AmTrust Financial Services shares are held by company insiders. Comparatively, 13.2% of shares of all “Fire, marine, & casualty insurance” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

AmTrust Financial Services competitors beat AmTrust Financial Services on 10 of the 15 factors compared.

AmTrust Financial Services Company Profile

AmTrust Financial Services, Inc. provides property and casualty insurance in the United States and internationally. The company operates in three segments: Small Commercial Business, Specialty Risk and Extended Warranty, and Specialty Program. The Small Commercial Business segment offers workers' compensation insurance products; and commercial package, and other property and casualty insurance products, such as commercial property, general liability, inland marine, employment practices liability, commercial automobile, and umbrella coverage to small businesses. The Specialty Risk and Extended Warranty segment provides custom designed coverages, such as accidental damage plans, mechanical breakdown protection, and payment protection plans in connection with the sale of consumer and commercial goods; and coverage for niche property, casualty, and specialty liability risks comprising general liability, employers' liability, and professional and medical liability. The Specialty Program segment offers workers' compensation, general liability, commercial auto liability, property coverage, excess and surplus lines programs, and other specialty commercial property and casualty insurance products to small and middle market companies. The company also provides reinsurance services primarily for personal and commercial automotive business. It distributes its policies third-party brokers, agents, retailers, or administrators. AmTrust Financial Services, Inc. was founded in 1998 and is based in New York, New York.

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