Head to Head Analysis: Atlantic American Corporation (AAME) versus Primerica (PRI)
Atlantic American Corporation (NASDAQ: AAME) and Primerica (NYSE:PRI) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, earnings, dividends, institutional ownership, profitabiliy, analyst recommendations and risk.
Valuation and Earnings
This table compares Atlantic American Corporation and Primerica’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Atlantic American Corporation||$168.19 million||0.44||$4.70 million||$0.05||72.01|
|Primerica||$1.58 billion||2.24||$406.18 million||$4.77||16.33|
Primerica has higher revenue and earnings than Atlantic American Corporation. Primerica is trading at a lower price-to-earnings ratio than Atlantic American Corporation, indicating that it is currently the more affordable of the two stocks.
Atlantic American Corporation pays an annual dividend of $0.02 per share and has a dividend yield of 0.6%. Primerica pays an annual dividend of $0.76 per share and has a dividend yield of 1.0%. Atlantic American Corporation pays out 40.0% of its earnings in the form of a dividend. Primerica pays out 15.9% 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. Primerica has raised its dividend for 6 consecutive years. Primerica is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares Atlantic American Corporation and Primerica’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Atlantic American Corporation||0.90%||-0.93%||-0.31%|
This is a summary of recent ratings and recommmendations for Atlantic American Corporation and Primerica, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Atlantic American Corporation||0||0||0||0||N/A|
Primerica has a consensus price target of $84.67, indicating a potential upside of 8.69%. Given Primerica’s higher possible upside, analysts plainly believe Primerica is more favorable than Atlantic American Corporation.
Institutional and Insider Ownership
5.1% of Atlantic American Corporation shares are held by institutional investors. Comparatively, 97.1% of Primerica shares are held by institutional investors. 79.3% of Atlantic American Corporation shares are held by company insiders. Comparatively, 1.2% of Primerica shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Risk & Volatility
Atlantic American Corporation has a beta of 0.36, meaning that its stock price is 64% less volatile than the S&P 500. Comparatively, Primerica has a beta of 1.13, meaning that its stock price is 13% more volatile than the S&P 500.
Primerica beats Atlantic American Corporation on 14 of the 16 factors compared between the two stocks.
Atlantic American Corporation Company Profile
Atlantic American Corporation is a holding company that operates through its subsidiaries in specialty markets within the life and health, and property and casualty insurance industries. The Company’s principal operating subsidiaries are American Southern Insurance Company and American Safety Insurance Company (together known as American Southern) within the property and casualty insurance industry, and Bankers Fidelity Life Insurance Company and Bankers Fidelity Assurance Company (together known as Bankers Fidelity) within the life and health insurance industry. Each of American Southern and Bankers Fidelity is managed separately based upon the type of products it offers. American Southern’s product lines include business automobile insurance policies, General Liability Insurance policies, Property Insurance policies and Surety Bonds. Products offered by Bankers Fidelity include ordinary and term life insurance, Medicare supplement and other accident and health insurance products.
Primerica Company Profile
Primerica Inc. (Primerica) is a distributor of financial products to middle-income households in the United States and Canada. The Company operates through three segments: Term Life Insurance, Investment and Savings Products, and Corporate and Other Distributed Products. The Term Life Insurance segment includes underwriting profits on its in-force book of term life insurance policies, net of reinsurance, which are underwritten by its life insurance company subsidiaries. The Investment and Savings Products segment includes retail and managed mutual funds, and annuities distributed through licensed broker-dealer subsidiaries and includes segregated funds, an individual annuity savings product that it underwrites in Canada through Primerica Life Insurance Company of Canada (Primerica Life Canada). In the United States, it distributes mutual fund and annuity products of various third-party companies. It also earns fees for account servicing on a subset of the mutual funds it distributes.
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