Financial Contrast: Kemper (KMPR) and Berkshire Hathaway (BRK.A)

Kemper (NYSE:KMPR) and Berkshire Hathaway (NYSE:BRK.A) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, profitability, risk, valuation, institutional ownership, dividends and earnings.

Profitability

This table compares Kemper and Berkshire Hathaway’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kemper 5.10% 10.11% 2.55%
Berkshire Hathaway 1.62% 6.86% 3.47%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Kemper and Berkshire Hathaway, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kemper 0 1 3 0 2.75
Berkshire Hathaway 0 0 1 0 3.00

Kemper presently has a consensus target price of $81.00, indicating a potential downside of 5.35%. Berkshire Hathaway has a consensus target price of $378,000.00, indicating a potential upside of 19.87%. Given Berkshire Hathaway’s stronger consensus rating and higher probable upside, analysts plainly believe Berkshire Hathaway is more favorable than Kemper.

Institutional and Insider Ownership

68.4% of Kemper shares are owned by institutional investors. Comparatively, 12.9% of Berkshire Hathaway shares are owned by institutional investors. 1.4% of Kemper shares are owned by company insiders. Comparatively, 4.2% of Berkshire Hathaway shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Dividends

Kemper pays an annual dividend of $1.00 per share and has a dividend yield of 1.2%. Berkshire Hathaway does not pay a dividend. Kemper pays out 22.9% of its earnings in the form of a dividend.

Volatility & Risk

Kemper has a beta of 1.15, indicating that its stock price is 15% more volatile than the S&P 500. Comparatively, Berkshire Hathaway has a beta of 0.78, indicating that its stock price is 22% less volatile than the S&P 500.

Valuation & Earnings

This table compares Kemper and Berkshire Hathaway’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Kemper $3.73 billion 1.49 $190.10 million $4.37 19.58
Berkshire Hathaway $247.84 billion 2.09 $4.02 billion $15,075.48 20.92

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

Summary

Berkshire Hathaway beats Kemper on 10 of the 16 factors compared between the two stocks.

Kemper Company Profile

Kemper Corporation, a diversified insurance holding company, provides property and casualty, and life and health insurance to individuals and businesses in the United States. It operates through three segments: Preferred Property & Casualty Insurance, Specialty Property & Casualty Insurance, and Life and Health Insurance. The company provides automobile, homeowners, renters, fire, umbrella, and other types of property and casualty insurance to individuals; and commercial automobile insurance to businesses. The company distributes its products through independent agents and brokers. The company also offers 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.

Berkshire Hathaway Company Profile

Berkshire Hathaway Inc., through its subsidiaries engages in insurance, freight rail transportation, and utility businesses. It provides property and casualty insurance and reinsurance, as well as life, accident, and health reinsurance; and operates railroad systems in North America. The company also generates, transmits, stores, and distributes electricity from natural gas, coal, wind, solar, hydro, nuclear, and geothermal sources; operates natural gas distribution and storage facilities, interstate pipelines, and compressor and meter stations; and holds interest in coal mining assets. In addition, it offers real estate brokerage services; and leases transportation equipment and furniture. Further, the company manufactures boxed chocolates and other confectionery products; specialty chemicals, metal cutting tools, and components for aerospace and power generation applications; flooring, insulation, roofing and engineered, building and engineered components, paints and coatings, and bricks and masonry products, as well as offers homebuilding and manufactured housing finance; recreational vehicles, apparel products, jewelry, and custom picture framing products; and alkaline batteries. Additionally, it manufactures castings, forgings, fasteners/fastener systems, and aerostructures; titanium, steel, and nickel; and seamless pipes and fittings. The company distributes newspapers, televisions, and information; franchises and services quick service restaurants; distributes electronic components; and offers logistics services, grocery and foodservice distribution services, professional aviation training programs, and fractional aircraft ownership programs. In addition, it retails automobiles; furniture, bedding, and accessories; household appliances, electronics, and computers; jewelry, watches, crystal, china, stemware, flatware, gifts, and collectibles; kitchenware; and motorcycle accessories. The company was founded in 1889 and is headquartered in Omaha, Nebraska.

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