Chubb (NYSE: CB) and Cna Financial (NYSE:CNA) are both large-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, dividends, earnings, valuation, risk, analyst recommendations and institutional ownership.
Chubb pays an annual dividend of $2.92 per share and has a dividend yield of 2.3%. Cna Financial pays an annual dividend of $1.20 per share and has a dividend yield of 2.6%. Chubb pays out 36.4% of its earnings in the form of a dividend. Cna Financial pays out 35.5% 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. Chubb has raised its dividend for 52 consecutive years. Cna Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.
Risk and Volatility
Chubb has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500. Comparatively, Cna Financial has a beta of 1.16, meaning that its share price is 16% more volatile than the S&P 500.
This table compares Chubb and Cna Financial’s net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
This is a breakdown of current ratings and target prices for Chubb and Cna Financial, as provided by MarketBeat.
||Strong Buy Ratings
Chubb presently has a consensus price target of $161.50, indicating a potential upside of 27.36%. Cna Financial has a consensus price target of $55.00, indicating a potential upside of 20.59%. Given Chubb’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Chubb is more favorable than Cna Financial.
Earnings and Valuation
This table compares Chubb and Cna Financial’s gross revenue, earnings per share and valuation.
||Earnings Per Share
Chubb has higher revenue and earnings than Cna Financial. Cna Financial is trading at a lower price-to-earnings ratio than Chubb, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
90.2% of Chubb shares are owned by institutional investors. Comparatively, 99.3% of Cna Financial shares are owned by institutional investors. 0.4% of Chubb shares are owned by company insiders. Comparatively, 0.2% of Cna Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Chubb beats Cna Financial on 12 of the 17 factors compared between the two stocks.
Chubb Limited, through its subsidiaries, provides insurance and reinsurance products worldwide. Its North America Commercial P&C Insurance segment offers commercial property, marine, general casualty, workers' compensation, package policies, and risk management; and professional lines, marine, construction, environmental, medical, cyber risk, and excess casualty, as well as group accident and health insurance to large, middle market, and small commercial businesses in the United States, Canada, and Bermuda. Its North America Personal P&C Insurance segment provides affluent and high net worth individuals and families with homeowners, automobile and collector cars, valuable articles, personal and excess liability, travel insurance, and recreational marine insurance and services in the United States and Canada. Its North America Agricultural Insurance segment offers multiple peril crop and crop-hail insurance; and coverage for farm and ranch property, as well as commercial agriculture products. Its Overseas General Insurance segment provides coverage for traditional commercial property and casualty; and specialty categories, such as financial lines, marine, energy, aviation, political risk, and construction risk, as well as group accident and health, and traditional and specialty personal lines for large corporations, middle markets, and small customers through retail brokers, agents, and other channels. Its Global Reinsurance segment offers traditional and specialty reinsurance under the Chubb Tempest Re brand name to property and casualty companies. Its Life Insurance segment provides protection and savings products comprising whole life, endowment plans, individual term life, group term life, medical and health, personal accident, credit life, universal life, and unit linked contracts. The company was formerly known as ACE Limited and changed its name to Chubb Limited in January 2016. Chubb Limited was founded in 1985 and is headquartered in Zurich, Switzerland.
About Cna Financial
CNA Financial Corporation provides commercial property and casualty insurance products primarily in the United States. It operates through Specialty, Commercial, International, Life & Group, and Corporate & Other segments. The company's property insurance products include property, marine, boiler, and machinery coverages; and casualty insurance products comprise workers compensation, general and product liability, commercial auto, and umbrella coverages. It also offers management and professional liability insurance and risk management services, and other specialized property and casualty coverages to various professional firms, including architects, real estate agents, and accounting and law firms; surety and fidelity bonds, and warranty and alternative risks products; directors and officers, employment practices, fiduciary and fidelity coverages to small and mid-size firms, public and private firms, and not-for-profit organizations; and professional and general liability, as well as associated standard property and casualty coverages for healthcare industry. In addition, the company offers long-tail exposures, including commercial automobile liability, workers' compensation, general and medical professional liability, other professional and management liability, and assumed reinsurance run-off and products liability; and short-tail exposures comprising property, commercial automobile physical damage, marine, surety, and warranty. CNA Financial Corporation markets its products through independent agents, brokers, and general underwriters to customers, including small, medium, and large businesses; insurance companies; associations; professionals; and other groups. It serves marine, property, financial services, healthcare, technology, oil and gas, construction, manufacturing, and life science industries. The company was founded in 1853 and is headquartered in Chicago, Illinois.
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