Allied World Assurance (OTCMKTS: AWHHF) and Hallmark Financial Services (NASDAQ:HALL) are both companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, earnings, risk, dividends, analyst recommendations, institutional ownership and valuation.
This table compares Allied World Assurance and Hallmark Financial Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Allied World Assurance||12.56%||8.96%||2.42%|
|Hallmark Financial Services||-1.19%||-0.42%||-0.09%|
This is a summary of recent ratings and recommmendations for Allied World Assurance and Hallmark Financial Services, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Allied World Assurance||0||2||0||0||2.00|
|Hallmark Financial Services||0||0||0||0||N/A|
Allied World Assurance presently has a consensus target price of $24.50, suggesting a potential downside of 52.47%. Given Allied World Assurance’s higher possible upside, research analysts plainly believe Allied World Assurance is more favorable than Hallmark Financial Services.
Volatility and Risk
Allied World Assurance has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500. Comparatively, Hallmark Financial Services has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500.
Earnings & Valuation
This table compares Allied World Assurance and Hallmark Financial Services’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Allied World Assurance||N/A||N/A||N/A||$2.97||17.36|
|Hallmark Financial Services||$375.95 million||0.50||$6.52 million||($0.26)||-39.46|
Hallmark Financial Services has higher revenue and earnings than Allied World Assurance. Hallmark Financial Services is trading at a lower price-to-earnings ratio than Allied World Assurance, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
86.5% of Allied World Assurance shares are owned by institutional investors. Comparatively, 65.0% of Hallmark Financial Services shares are owned by institutional investors. 3.2% of Allied World Assurance shares are owned by company insiders. Comparatively, 28.7% of Hallmark Financial Services shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Allied World Assurance pays an annual dividend of $0.52 per share and has a dividend yield of 1.0%. Hallmark Financial Services does not pay a dividend. Allied World Assurance pays out 17.5% of its earnings in the form of a dividend.
Allied World Assurance beats Hallmark Financial Services on 8 of the 12 factors compared between the two stocks.
About Allied World Assurance
Allied World Assurance Company Holdings Ltd is a Germany-based holding company. It provides property, casualty and specialty insurance and reinsurance solutions to clients around the world. The Company operates in three segments: North American Insurance, Global Markets Insurance and Reinsurance. The North American Insurance segment consists of the Company’s direct insurance operations in the United States, Bermuda and Canada. The Global Markets Insurance segment includes all of the Company’s direct insurance operations outside of North America. The Company’s reinsurance segment includes the reinsurance of property, general casualty, professional liability, specialty lines and property catastrophe coverage’s written by other reinsurance companies. The Company leases space in Australia, Bermuda, Canada, Hong Kong, Ireland, Labuan, Singapore, the United Kingdom and the United States for the operation of its North American Insurance, Global Markets Insurance and Reinsurance segments.
About Hallmark Financial Services
Hallmark Financial Services, Inc. is an insurance holding company. The Company markets, distributes, underwrites and services its property/casualty insurance products to businesses and individuals. Its business involves marketing, distributing, underwriting and servicing insurance products, as well as providing other insurance related services. Its segments include Standard Commercial Segment, Specialty Commercial Segment and Personal Segment. The Company’s Standard Commercial P&C operating unit primarily underwrites low-severity, short-tailed commercial property/casualty insurance products in the standard market. The Company reinsures a portion of the risk it underwrites in order to control the exposure to losses and to protect capital resources. Its Workers Compensation operating unit specializes in small and middle market workers compensation business. Its Specialty Commercial operating unit offers general aviation and satellite launch insurance products and services.
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