Comparing State National Companies (SNC) and Montpelier Re (MRH)

State National Companies (NASDAQ: SNC) and Montpelier Re (NYSE:MRH) are both small-cap financials companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, institutional ownership, valuation, profitability, earnings and dividends.

Earnings and Valuation

This table compares State National Companies and Montpelier Re’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
State National Companies $217.07 million 4.08 $49.07 million $1.25 16.82
Montpelier Re N/A N/A N/A $3.84 11.09

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

Dividends

State National Companies pays an annual dividend of $0.24 per share and has a dividend yield of 1.1%. Montpelier Re does not pay a dividend. State National Companies pays out 19.2% of its earnings in the form of a dividend.

Profitability

This table compares State National Companies and Montpelier Re’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
State National Companies 23.91% 18.02% 1.72%
Montpelier Re 35.71% 13.24% 6.70%

Insider & Institutional Ownership

58.6% of State National Companies shares are held by institutional investors. 34.8% of State National Companies shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations for State National Companies and Montpelier Re, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
State National Companies 1 2 4 0 2.43
Montpelier Re 0 0 0 0 N/A

State National Companies currently has a consensus target price of $59.50, suggesting a potential upside of 183.06%. Given State National Companies’ higher probable upside, analysts plainly believe State National Companies is more favorable than Montpelier Re.

Summary

State National Companies beats Montpelier Re on 8 of the 12 factors compared between the two stocks.

About State National Companies

State National Companies, Inc. is a specialty provider of property and casualty insurance. The Company’s segments include Program Services, Lender Services and Corporate. In the Program Services segment, the Company operates an issuing carrier (fronting) business to provide insurance capacity access to the United States property and casualty insurance markets. In the Lender Services segment, the Company specializes in providing collateral protection insurance, which insures automobiles held as collateral for loans made by financial institutions. The Company writes its insurance business through its insurance company subsidiaries, which include State National Insurance Company, Inc. (SNIC), National Specialty Insurance Company (NSIC) and United Specialty Insurance Company (USIC). As of December 31, 2016, SNIC and NSIC were admitted carriers licensed to write property and casualty business in all 50 states and the District of Columbia. USIC is an admitted carrier in Delaware.

About Montpelier Re

Montpelier RE Holdings Ltd. is a holding company. The Company provides customized insurance and reinsurance solutions to the global market. Through its affiliates in Bermuda, it provides institutional and retail investors with direct access to the global property reinsurance market. It operates in three segments: Montpelier Bermuda, which consists of the assets and operations of Montpelier Reinsurance Ltd., which is its wholly owned operating subsidiary based in Pembroke, Bermuda and is registered as a Bermuda Class four insurer; Montpelier at Lloyd’s, which consists of the assets and operations of Montpelier Syndicate 5151, Montpelier Capital Limited, Montpelier at Lloyd’s Limited, Montpelier Underwriting Services Limited and Montpelier Underwriting Inc., and Collateralized Reinsurance, which is marketed under the name Blue Capital. Blue Capital is an asset management platform offering property catastrophe reinsurance-linked investment products to institutional and retail investors.

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