Conifer (NASDAQ: CNFR) and Cincinnati Financial (NASDAQ:CINF) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, valuation, profitability and risk.

Dividends

Cincinnati Financial pays an annual dividend of $2.00 per share and has a dividend yield of 2.7%. Conifer does not pay a dividend. Cincinnati Financial pays out 66.0% of its earnings in the form of a dividend. Conifer has raised its dividend for 57 consecutive years.

Risk and Volatility

Conifer has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500. Comparatively, Cincinnati Financial has a beta of 0.93, meaning that its stock price is 7% less volatile than the S&P 500.

Insider & Institutional Ownership

25.6% of Conifer shares are held by institutional investors. Comparatively, 64.5% of Cincinnati Financial shares are held by institutional investors. 45.5% of Conifer shares are held by insiders. Comparatively, 9.3% of Cincinnati Financial shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Conifer and Cincinnati Financial’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Conifer $93.88 million 0.55 -$8.43 million ($3.42) -1.77
Cincinnati Financial $5.45 billion 2.23 $591.00 million $3.03 24.43

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

Profitability

This table compares Conifer and Cincinnati Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Conifer -27.29% -43.07% -12.67%
Cincinnati Financial 8.93% 5.85% 2.03%

Analyst Recommendations

This is a breakdown of current recommendations for Conifer and Cincinnati Financial, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Conifer 0 1 0 0 2.00
Cincinnati Financial 0 2 1 0 2.33

Cincinnati Financial has a consensus price target of $77.33, suggesting a potential upside of 4.46%. Given Cincinnati Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Cincinnati Financial is more favorable than Conifer.

Summary

Cincinnati Financial beats Conifer on 13 of the 17 factors compared between the two stocks.

Conifer Company Profile

Conifer Holdings, Inc. is an insurance holding company. Through its insurance company subsidiaries, the Company offers insurance coverage in both specialty commercial and specialty personal product lines. It operates through two segments: commercial lines and personal lines. It is engaged in underwriting and marketing insurance coverage, and administering claims processing for such policies. The Company offers coverage for property, liability, automobile, and other miscellaneous coverage primarily to owner-operated small and mid-sized businesses, professional organizations and hospitality businesses, such as restaurants, bars and taverns. The Company offers coverage for low-value dwelling, wind-exposed homeowners and automobile. Its personal lines products include Catastrophe coverage, including hurricane and wind coverage, to underserved homeowners in Florida, Hawaii and Texas, and Dwelling insurance.

Cincinnati Financial Company Profile

Cincinnati Financial Corporation is an insurance holding company. It operates through five segments: Commercial lines insurance, Personal lines insurance, Excess and surplus lines insurance, and Life insurance and Investments. Its Commercial Lines Insurance Segment provides five commercial business lines: commercial casualty, commercial property, commercial auto, workers’ compensation and other commercial lines. Its personal lines property insurance segment writes personal lines coverage in accounts that include both auto and homeowner coverages, as well as coverages that are part of its other personal business line. The excess and surplus lines Insurance segment covers business risks with characteristics, such as the nature of the business or its claim history that are difficult to profitably insure in the standard commercial lines market. The life insurance business lines include term life insurance, universal life insurance, worksite products and whole life insurance.

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