American National Insurance (NASDAQ: ANAT) and Patriot National (NYSE:PN) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, analyst recommendations, valuation and profitability.

Dividends

American National Insurance pays an annual dividend of $3.28 per share and has a dividend yield of 2.8%. Patriot National does not pay a dividend. American National Insurance pays out 45.4% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares American National Insurance and Patriot National’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
American National Insurance $3.28 billion 0.96 $260.52 million $7.23 16.14
Patriot National $233.03 million 0.16 $31.71 million ($0.02) -60.00

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

Insider and Institutional Ownership

65.2% of American National Insurance shares are owned by institutional investors. Comparatively, 13.3% of Patriot National shares are owned by institutional investors. 23.5% of American National Insurance shares are owned by insiders. Comparatively, 59.9% of Patriot National shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares American National Insurance and Patriot National’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
American National Insurance 5.95% 2.61% 0.50%
Patriot National -0.35% 7.15% 1.91%

Volatility & Risk

American National Insurance has a beta of 1.34, indicating that its stock price is 34% more volatile than the S&P 500. Comparatively, Patriot National has a beta of 2.8, indicating that its stock price is 180% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for American National Insurance and Patriot National, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
American National Insurance 0 0 0 0 N/A
Patriot National 0 2 0 0 2.00

Patriot National has a consensus target price of $7.75, indicating a potential upside of 545.83%. Given Patriot National’s higher probable upside, analysts plainly believe Patriot National is more favorable than American National Insurance.

Summary

American National Insurance beats Patriot National on 8 of the 14 factors compared between the two stocks.

About American National Insurance

American National Insurance Company is engaged in life insurance, annuities, and property and casualty insurance. The Company also offers limited health insurance. Its family of companies includes six life insurance companies, eight property and casualty insurance companies, and various non-insurance subsidiaries. Its business segments include Life, which offers products, such as Whole Life, Term Life, Universal Life, Variable Universal Life and Credit Life Insurance; Annuity, including products, such as Deferred Annuity, Single Premium Immediate Annuity and Variable Annuity; Health, including, such as Medicare Supplement, Supplemental Insurance, Stop-Loss, Credit Disability and Medical Expense; Property and Casualty, which offers products, such as Personal Lines, Commercial Lines and Credit-Related Property Insurance products, and Corporate and Other, which consists of its invested assets that are not used to support insurance activities, and non-insurance subsidiaries.

About Patriot National

Patriot National, Inc. is an independent national provider of technology-enabled outsourcing solutions that help insurance carriers, employers and other clients mitigate risk and comply with complex regulations. It offers a range of end-to-end insurance related and specialty services. The Company principally offers approximately two types of services: front-end services, such as brokerage, underwriting and policyholder services, and back-end services, such as claims adjudication and administration. It also offers specialty services, including technology outsourcing and other information technology (IT) services, as well as employment pre-screening and background checks. The Company’s brokerage and policyholder services include general agency services and specialty underwriting and policyholder services provided to its insurance carrier clients. The Company’s claims administration services relate to the administration and resolution of workers’ compensation claims.

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