Critical Comparison: ProAssurance (NYSE:PRA) & Navigators Group (NYSE:NAVG)

ProAssurance (NYSE:PRA) and Navigators Group (NASDAQ:NAVG) are both mid-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, analyst recommendations, valuation and profitability.

Insider and Institutional Ownership

81.7% of ProAssurance shares are owned by institutional investors. Comparatively, 69.6% of Navigators Group shares are owned by institutional investors. 1.7% of ProAssurance shares are owned by insiders. Comparatively, 22.0% of Navigators Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

ProAssurance pays an annual dividend of $1.24 per share and has a dividend yield of 3.3%. Navigators Group pays an annual dividend of $0.28 per share and has a dividend yield of 0.4%. ProAssurance pays out 83.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Navigators Group pays out 15.0% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of current ratings and price targets for ProAssurance and Navigators Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ProAssurance 1 3 1 0 2.00
Navigators Group 0 3 0 0 2.00

ProAssurance presently has a consensus target price of $41.75, indicating a potential upside of 10.71%. Navigators Group has a consensus target price of $70.00, indicating a potential upside of 0.06%. Given ProAssurance’s higher probable upside, research analysts plainly believe ProAssurance is more favorable than Navigators Group.

Earnings & Valuation

This table compares ProAssurance and Navigators Group’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ProAssurance $886.03 million 2.29 $47.06 million $1.48 25.48
Navigators Group $1.44 billion 1.45 $34.24 million $1.87 37.41

ProAssurance has higher earnings, but lower revenue than Navigators Group. ProAssurance is trading at a lower price-to-earnings ratio than Navigators Group, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

ProAssurance has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500. Comparatively, Navigators Group has a beta of 0.35, indicating that its stock price is 65% less volatile than the S&P 500.

Profitability

This table compares ProAssurance and Navigators Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ProAssurance 7.01% 3.98% 1.34%
Navigators Group 0.11% 0.50% 0.11%

Summary

ProAssurance beats Navigators Group on 10 of the 15 factors compared between the two stocks.

ProAssurance Company Profile

ProAssurance Corporation, through its subsidiaries, provides property and casualty insurance, and reinsurance products in the United States. The company operates through Specialty Property and Casualty, Workers' Compensation Insurance, Segregated Portfolio Cell Reinsurance, and Lloyd's Syndicate segments. It offers professional liability insurance for healthcare professionals and facilities; professional liability insurance for attorneys; liability insurance for medical technology and life sciences risks; and workers' compensation insurance for employers, groups, and associations. The company also participates in Lloyd's of London Syndicate 1729, which underwrites property and casualty insurance, and reinsurance; and Syndicate 6131 that underwrites contingency and specialty property insurance. ProAssurance Corporation markets its products through independent agencies and brokers, as well as an internal sales force. The company was founded in 1976 and is headquartered in Birmingham, Alabama.

Navigators Group Company Profile

The Navigators Group, Inc., together with its subsidiaries, underwrites marine, property and casualty, and professional liability insurance products and services in the United States and internationally. The company operates through the U.S. Insurance, International Insurance, and Global Reinsurance segments. It offers marine insurance products comprising cargo, craft, inland marine, and marine liability; fishing vessels, transport, war, hull, and other marine; and protection and indemnity, specie and fine arts, writing banks and cash in transit risks, and energy liability insurance products. The company also provides commercial retail excess casualty and specialty wholesale excess casualty; general liability; contractors pollution liability, site pollution liability, and integrated casualty; auto, life sciences, surety, media, arts and entertainment, and other property and casualty; onshore and offshore energy, and other energy and engineering products that includes power station insurance; and political violence and terrorism insurance products. In addition, it offers directors and officers; architects and engineers, accountants, miscellaneous professional liability, real estate errors and omissions (E&O), and other E&O; and warranties and indemnity insurance products, as well as cyber and run-off insurance products. Further, the company offers accident and health, management liability, specialty casualty, agriculture, and other reinsurance products. The Navigators Group, Inc. distributes its products through international, national, and regional retail and wholesale insurance brokers. The company was founded in 1982 and is headquartered in Stamford, Connecticut.

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