Employers (NYSE:EIG) and Donegal Group (NASDAQ:DGICB) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, earnings, institutional ownership, risk, profitability, valuation and analyst recommendations.
Risk and Volatility
Employers has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500. Comparatively, Donegal Group has a beta of 0.55, meaning that its share price is 45% less volatile than the S&P 500.
This table compares Employers and Donegal Group’s net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
Insider & Institutional Ownership
80.5% of Employers shares are held by institutional investors. Comparatively, 1.6% of Donegal Group shares are held by institutional investors. 3.0% of Employers shares are held by company insiders. Comparatively, 7.2% of Donegal Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Earnings & Valuation
This table compares Employers and Donegal Group’s top-line revenue, earnings per share and valuation.
||Earnings Per Share
Employers has higher revenue and earnings than Donegal Group.
Employers pays an annual dividend of $0.80 per share and has a dividend yield of 1.9%. Donegal Group pays an annual dividend of $0.50 per share and has a dividend yield of 4.2%. Employers pays out 19.5% of its earnings in the form of a dividend. Employers has raised its dividend for 3 consecutive years.
This is a breakdown of current recommendations for Employers and Donegal Group, as reported by MarketBeat.
||Strong Buy Ratings
Employers currently has a consensus price target of $47.00, suggesting a potential upside of 9.89%. Given Employers’ higher possible upside, research analysts clearly believe Employers is more favorable than Donegal Group.
Employers beats Donegal Group on 11 of the 14 factors compared between the two stocks.
Employers Holdings, Inc., through its subsidiaries, operates in the commercial property and casualty insurance industry primarily in the United States. It offers workers' compensation insurance to small businesses in low to medium hazard industries. The company markets its products through independent local, regional, and national agents and brokers; and alternative distribution channels comprising its partners, as well as through national, regional, and local trade groups and associations. Employers Holdings, Inc. was founded in 2000 and is based in Reno, Nevada.
About Donegal Group
Donegal Group Inc., an insurance holding company, provides property and casualty insurance to businesses and individuals in the Mid-Atlantic, Midwestern, New England, and southern states. It operates through four segments: Investment Function, Personal Lines of Insurance, Commercial Lines of Insurance, and Investment in DFSC. The company offers private passenger automobile policies that provide protection against liability for bodily injury and property damage arising from automobile accidents, as well as protection against loss from damage to automobiles. It also offers homeowners policies, which provide coverage for damage to residences and their contents from a range of perils, including fire, lightning, windstorm, and theft; and liability of the insured arising from injury to other persons or their property. In addition, the company offers commercial automobile policies that provide protection against liability for bodily injury and property damage arising from automobile accidents and protection against loss from damage to automobiles owned by the insured; commercial multi-peril policies that provide protection to businesses against various perils, primarily combining liability and physical damage coverages; and workers' compensation policies, which provide benefits to employees for injuries sustained during employment. Donegal Group Inc., through its interest in Donegal Financial Services Corporation, operates a savings bank. The company markets its insurance products through a network of approximately 2,400 independent insurance agencies. Donegal Group Inc. was founded in 1986 and is headquartered in Marietta, Pennsylvania. Donegal Group Inc. is a subsidiary of Donegal Mutual Insurance Company.
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