Critical Comparison: AEGON (AEG) and Voya Financial (VOYA)

AEGON (NYSE: AEG) and Voya Financial (NYSE:VOYA) are both financials companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, analyst recommendations, institutional ownership, dividends, valuation and profitability.

Analyst Recommendations

This is a summary of current recommendations for AEGON and Voya Financial, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AEGON 0 2 0 0 2.00
Voya Financial 1 1 10 0 2.75

AEGON presently has a consensus price target of $4.60, indicating a potential downside of 30.20%. Voya Financial has a consensus price target of $52.18, indicating a potential upside of 8.67%. Given Voya Financial’s stronger consensus rating and higher probable upside, analysts clearly believe Voya Financial is more favorable than AEGON.

Volatility & Risk

AEGON has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500. Comparatively, Voya Financial has a beta of 1.61, meaning that its share price is 61% more volatile than the S&P 500.

Dividends

AEGON pays an annual dividend of $0.25 per share and has a dividend yield of 3.8%. Voya Financial pays an annual dividend of $0.04 per share and has a dividend yield of 0.1%. AEGON pays out 24.3% of its earnings in the form of a dividend. Voya Financial pays out -2.2% 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. Voya Financial has raised its dividend for 2 consecutive years.

Insider and Institutional Ownership

9.1% of AEGON shares are held by institutional investors. Comparatively, 96.2% of Voya Financial shares are held by institutional investors. 0.2% of Voya Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares AEGON and Voya Financial’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AEGON $37.25 billion 0.36 $483.58 million $1.03 6.40
Voya Financial $10.78 billion 0.80 -$428.00 million ($1.79) -26.83

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

Profitability

This table compares AEGON and Voya Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AEGON 5.64% 6.60% 0.39%
Voya Financial -3.64% 3.92% 0.25%

Summary

Voya Financial beats AEGON on 9 of the 17 factors compared between the two stocks.

AEGON Company Profile

Aegon N.V. (Aegon) is an international life insurance, pensions and asset management company. The Company’s segments include the Americas, which includes the United States, Mexico and Brazil; the Netherlands; the United Kingdom; Central & Eastern Europe; Spain & Portugal; Asia, and Aegon Asset Management. It offers protection against mortality, morbidity and longevity risks, including traditional and universal life. It offers products with mortality, morbidity, and longevity risks, including traditional and universal life; mortgages; annuity products, and banking products. It offers individual protection products, such as annuities, term insurance, income protection and international/offshore bonds. It has activities in the Czech Republic, Hungary, Poland, Romania, Slovakia and Turkey. It offers life insurance marketed to high-net-worth individuals in Hong Kong and Singapore. It also offers investment products covering third-party customers, insurance-linked solutions.

Voya Financial Company Profile

Voya Financial, Inc. is a retirement, investment and insurance company. The Company operates through five segments: Retirement, Investment Management, Annuities, Individual Life and Employee Benefits. The Retirement segment is a provider of retirement services and products in the United States. The Investment Management segment offers domestic and international fixed income, equity, multi-asset and alternatives products and solutions. The Annuities segment provides fixed and indexed annuities, tax-qualified mutual fund custodial and other investment-only products and payout annuities for pre-retirement wealth accumulation and post-retirement income management sold through multiple channels. The Individual Life segment provides wealth protection and transfer opportunities through universal and variable products. The Employee Benefits segment provides stop loss, group life, voluntary employee-paid and disability products to mid-sized and large businesses.

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