Federated National (FNHC) vs. Allstate (ALL) Head to Head Survey

Federated National (NASDAQ: FNHC) and Allstate (NYSE:ALL) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, profitability, risk and dividends.

Analyst Recommendations

This is a breakdown of current ratings for Federated National and Allstate, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Federated National 0 0 1 0 3.00
Allstate 2 7 3 0 2.08

Federated National currently has a consensus target price of $22.00, indicating a potential upside of 48.75%. Allstate has a consensus target price of $94.50, indicating a potential downside of 2.17%. Given Federated National’s stronger consensus rating and higher possible upside, equities analysts plainly believe Federated National is more favorable than Allstate.

Volatility & Risk

Federated National has a beta of 1.29, indicating that its share price is 29% more volatile than the S&P 500. Comparatively, Allstate has a beta of 0.97, indicating that its share price is 3% less volatile than the S&P 500.

Institutional & Insider Ownership

62.3% of Federated National shares are owned by institutional investors. Comparatively, 76.9% of Allstate shares are owned by institutional investors. 10.8% of Federated National shares are owned by insiders. Comparatively, 1.5% of Allstate shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Federated National and Allstate’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Federated National -2.54% -4.03% -1.06%
Allstate 7.32% 13.11% 2.32%

Valuation and Earnings

This table compares Federated National and Allstate’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Federated National $316.38 million 0.61 -$190,000.00 ($0.71) -20.83
Allstate $36.53 billion 0.95 $1.88 billion $7.20 13.42

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

Dividends

Federated National pays an annual dividend of $0.32 per share and has a dividend yield of 2.2%. Allstate pays an annual dividend of $1.48 per share and has a dividend yield of 1.5%. Federated National pays out -45.1% of its earnings in the form of a dividend. Allstate pays out 20.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Federated National has raised its dividend for 7 consecutive years. Federated National is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Allstate beats Federated National on 9 of the 16 factors compared between the two stocks.

Federated National Company Profile

Federated National Holding Company (FNHC) is an insurance holding company that controls all steps in the insurance underwriting, distribution and claims processes through its subsidiaries and its contractual relationships with its independent agents and general agents. The Company is authorized to underwrite homeowners’ multi-peril (homeowners), commercial general liability, federal flood, personal auto and various other lines of insurance in Florida and various other states. The Company markets, distributes and services its own and third-party insurers’ products and its other services through a network of independent agents. The Company’s insurance lines of business include Homeowners’ Property and Casualty Insurance, Commercial General Liability, Personal Automobile and Flood. FNIC and MNIC underwrite homeowners’ insurance in Florida, and FNIC underwrites insurance in Alabama, Louisiana and South Carolina. Alabama and Louisiana.

Allstate Company Profile

The Allstate Corporation (Allstate) is a holding company for Allstate Insurance Company. The Company’s business is conducted principally through Allstate Insurance Company, Allstate Life Insurance Company and other subsidiaries. It is engaged in the property-liability insurance business and the life insurance, retirement and investment products business. Its segments include Allstate Protection, Allstate Financial, Discontinued Lines and Coverages, and Corporate and Other. The Allstate Protection segment sells private passenger auto, homeowners, and other property-liability insurance products through agencies and directly through contact centers and the Internet. The Allstate Financial segment sells life insurance and voluntary accident and health insurance products. The Corporate and Other segment consists of holding company activities and certain non-insurance operations. Its Discontinued Lines and Coverages segment includes results from property-liability insurance coverage.

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