Infinity Property and Casualty (NASDAQ: IPCC) and Atlas Financial (NASDAQ:AFH) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.

Institutional and Insider Ownership

95.9% of Infinity Property and Casualty shares are owned by institutional investors. Comparatively, 79.7% of Atlas Financial shares are owned by institutional investors. 3.2% of Infinity Property and Casualty shares are owned by company insiders. Comparatively, 13.3% of Atlas Financial shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and target prices for Infinity Property and Casualty and Atlas Financial, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Infinity Property and Casualty 0 1 1 0 2.50
Atlas Financial 0 0 3 0 3.00

Infinity Property and Casualty presently has a consensus price target of $99.50, indicating a potential downside of 6.31%. Atlas Financial has a consensus price target of $18.50, indicating a potential downside of 1.86%. Given Atlas Financial’s stronger consensus rating and higher probable upside, analysts clearly believe Atlas Financial is more favorable than Infinity Property and Casualty.

Dividends

Infinity Property and Casualty pays an annual dividend of $2.32 per share and has a dividend yield of 2.2%. Atlas Financial does not pay a dividend. Infinity Property and Casualty pays out 49.2% of its earnings in the form of a dividend. Atlas Financial has raised its dividend for 9 consecutive years.

Profitability

This table compares Infinity Property and Casualty and Atlas Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Infinity Property and Casualty 3.37% 7.02% 2.03%
Atlas Financial 0.92% -2.57% -0.78%

Risk & Volatility

Infinity Property and Casualty has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500. Comparatively, Atlas Financial has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.

Earnings & Valuation

This table compares Infinity Property and Casualty and Atlas Financial’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Infinity Property and Casualty $1.54 billion 0.75 $43.08 million $4.72 22.50
Atlas Financial $177.58 million 1.28 $2.64 million $0.19 99.21

Infinity Property and Casualty has higher revenue and earnings than Atlas Financial. Infinity Property and Casualty is trading at a lower price-to-earnings ratio than Atlas Financial, indicating that it is currently the more affordable of the two stocks.

About Infinity Property and Casualty

Infinity Property and Casualty Corporation is a holding company. The Company’s segments include Personal Auto, Commercial Vehicle and Classic Collector (its segments are Personal Auto and Commercial Vehicle). The Company writes personal automobile insurance with a concentration on nonstandard automobile insurance, commercial vehicle insurance and classic collector automobile insurance. The Company offers personal and commercial automobile insurance in states, including Arizona, California, Florida and Texas. Personal Automobile is its insurance product, which provides coverage to individuals for liability to others for bodily injury and property damage and for physical damage to an insured’s own vehicle from collision and various other perils. Commercial Vehicle provides coverage to businesses for liability to others for bodily injury and property damage and for physical damage to vehicles from collision. Classic Collector provides protection for classic collectible automobiles.

About Atlas Financial

Atlas Financial Holdings Inc formerly JJR VI Acquisition Corp is a Canada-based company. It is engaged in the business of providing commercial automobile insurance in the United States with a niche market orientation. The Company’s automobile insurance products provide coverage in three areas: liability, accident benefits and physical damage. Liability insurance provides coverage where the insured is responsible for an automobile accident, for the payment for injuries and property damage to third parties. Accident benefit policies or personal injury protection policies provide coverage for loss of income, medical and rehabilitation expenses for insured persons who are injured in an automobile accident, Physical damage coverages provide for the payment of damages to an insured automobile arising from a collision with another object or from other risks. In January 2013, the Company acquired Camelot Services Inc. and its insurance subsidiary, Gateway Insurance Company.

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