Kemper (NYSE: HRTG) and Heritage Insurance (NYSE:HRTG) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.
Kemper pays an annual dividend of $0.96 per share and has a dividend yield of 1.2%. Heritage Insurance pays an annual dividend of $0.24 per share and has a dividend yield of 1.6%. Kemper pays out 58.5% of its earnings in the form of a dividend. Heritage Insurance pays out 15.7% 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. Heritage Insurance is clearly the better dividend stock, given its higher yield and lower payout ratio.
This table compares Kemper and Heritage Insurance’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Kemper||$2.72 billion||1.93||$120.90 million||$1.64||49.60|
|Heritage Insurance||$406.62 million||0.96||-$1.11 million||$1.53||9.58|
Kemper has higher revenue and earnings than Heritage Insurance. Heritage Insurance is trading at a lower price-to-earnings ratio than Kemper, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Kemper has a beta of 1.13, indicating that its stock price is 13% more volatile than the S&P 500. Comparatively, Heritage Insurance has a beta of 1.32, indicating that its stock price is 32% more volatile than the S&P 500.
This is a summary of current ratings and recommmendations for Kemper and Heritage Insurance, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Heritage Insurance has a consensus price target of $20.60, suggesting a potential upside of 40.61%. Given Heritage Insurance’s higher possible upside, analysts plainly believe Heritage Insurance is more favorable than Kemper.
This table compares Kemper and Heritage Insurance’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional & Insider Ownership
52.3% of Kemper shares are held by institutional investors. Comparatively, 77.2% of Heritage Insurance shares are held by institutional investors. 0.9% of Kemper shares are held by company insiders. Comparatively, 25.3% of Heritage Insurance shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Heritage Insurance beats Kemper on 9 of the 16 factors compared between the two stocks.
Kemper Corporation, a diversified insurance holding company, provides property and casualty, and life and health insurance to individuals and businesses in the United States. The company's Property & Casualty Insurance segment provides automobile, homeowners, renters, fire, umbrella, and other types of property and casualty insurance to individuals; and commercial automobile insurance to businesses. This segment distributes its products through independent agents and brokers. The Life & Health Insurance segment provides life insurance, including permanent and term insurance, as well as supplemental accident and health insurance products; Medicare supplement insurance; and limited health insurance coverages, such as fixed indemnity, specified disease, and accident-only plans to individuals in rural areas. The company was formerly known as Unitrin, Inc. and changed its name to Kemper Corporation in August 2011. Kemper Corporation was founded in 1990 and is headquartered in Chicago, Illinois.
About Heritage Insurance
Heritage Insurance Holdings, Inc., through its subsidiaries, provides personal and commercial residential insurance products. The company offers personal residential property insurance for single-family homeowners and condominium owners; rental property insurance; and commercial residential insurance, as well as residential wind-only property insurance in Alabama, Connecticut, Florida, Georgia, Hawaii, Massachusetts, New York, New Jersey, North Carolina, Rhode Island, and South Carolina. As of December 31, 2017, it had approximately 521,350 personal residential policies and 3,100 commercial residential policies. The company markets and writes its voluntary personal line policies through a network of retail independent agents, wholesale agents, and a partnership with a direct agency, as well as indirectly to approximately 1,500 retail locations through 8 wholesale agency relationships. It also provides restoration, and emergency and recovery services; and property management, retail agency, and reinsurance services. The company was founded in 2012 and is headquartered in Clearwater, Florida.
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