Financial Survey: CNO Financial Group (NYSE:CNO) vs. James River Group (NASDAQ:JRVR)

CNO Financial Group (NYSE:CNO) and James River Group (NASDAQ:JRVR) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their profitability, valuation, dividends, earnings, analyst recommendations, institutional ownership and risk.

Analyst Recommendations

This is a breakdown of current recommendations for CNO Financial Group and James River Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CNO Financial Group	0	2	3	0	2.60
James River Group	2	5	0	0	1.71

CNO Financial Group currently has a consensus price target of $48.75, suggesting a potential downside of 5.21%. James River Group has a consensus price target of $6.44, suggesting a potential upside of 64.64%. Given James River Group’s higher probable upside, analysts clearly believe James River Group is more favorable than CNO Financial Group.

Valuation and Earnings

This table compares CNO Financial Group and James River Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CNO Financial Group	$4.49 billion	1.07	$229.30 million	$2.49	20.65
James River Group	$666.71 million	0.27	$47.43 million	$0.34	11.50

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

Insider and Institutional Ownership

95.4% of CNO Financial Group shares are owned by institutional investors. Comparatively, 95.2% of James River Group shares are owned by institutional investors. 3.4% of CNO Financial Group shares are owned by company insiders. Comparatively, 33.8% of James River Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

CNO Financial Group pays an annual dividend of $0.72 per share and has a dividend yield of 1.4%. James River Group pays an annual dividend of $0.04 per share and has a dividend yield of 1.0%. CNO Financial Group pays out 28.9% of its earnings in the form of a dividend. James River Group pays out 11.8% 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. CNO Financial Group has increased its dividend for 2 consecutive years. CNO Financial Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

CNO Financial Group has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500. Comparatively, James River Group has a beta of -0.16, indicating that its stock price is 116% less volatile than the S&P 500.

Profitability

This table compares CNO Financial Group and James River Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CNO Financial Group	5.44%	17.65%	1.18%
James River Group	4.34%	10.79%	1.13%

Summary

CNO Financial Group beats James River Group on 14 of the 17 factors compared between the two stocks.

About CNO Financial Group

CNO Financial Group, Inc., through its subsidiaries, develops, markets, and administers health insurance, annuity, individual life insurance, insurance products, and financial services for senior and middle-income markets in the United States. It offers Medicare supplement, supplemental health, and long-term care insurance policies; life insurance; and annuities, as well as Medicare advantage plans to individuals through phone, online, mail, and face-to-face. The company also focuses on sale of voluntary benefit life and health insurance products for businesses, associations, and other membership groups by interacting with customers at their place of employment. In addition, it provides fixed indexed annuities; fixed interest annuities, including fixed rate single and flexible premium deferred annuities; single premium immediate annuities; supplemental health products, such as specified disease, accident, and hospital indemnity products; and long-term care plans primarily to retirees and older self-employed individuals in the middle-income market. Further, the company offers universal life and other interest-sensitive life products; and traditional life policies that include whole life, graded benefit life, term life, and single premium whole life products, as well as graded benefit life insurance products. It markets its products under the Bankers Life, Washington National, and Colonial Penn brand names. The company was founded in 1979 and is headquartered in Carmel, Indiana.

About James River Group

James River Group Holdings, Ltd., through its subsidiaries, provides specialty insurance services. It operates through Excess and Surplus Lines, and Specialty Admitted Insurance segments. The Excess and Surplus Lines segment underwrites liability and property insurance in the United States Puerto Rice, and the United States Virgin Islands. This segment distributes its insurance policies primarily through wholesale insurance brokers. The Specialty Admitted Insurance segment provides insurance for fronting, program administrators, managing general agents, and independent retail agents. James River Group Holdings, Ltd. was founded in 2002 and is headquartered in Pembroke, Bermuda.