Allied World Assurance Company Holdings (NYSE:AWH) & Allstate Corporation (The) (ALL) Financial Review

Allstate Corporation (The) (NYSE: ALL) and Allied World Assurance Company Holdings (NYSE:AWH) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, earnings, profitability, analyst recommendations, institutional ownership, valuation and dividends.

Risk and Volatility

Allstate Corporation (The) has a beta of 1.09, meaning that its stock price is 9% more volatile than the S&P 500. Comparatively, Allied World Assurance Company Holdings has a beta of 0.69, meaning that its stock price is 31% less volatile than the S&P 500.

Profitability

This table compares Allstate Corporation (The) and Allied World Assurance Company Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Allstate Corporation (The) 7.02% 12.73% 2.24%
Allied World Assurance Company Holdings 12.56% 8.96% 2.42%

Earnings & Valuation

This table compares Allstate Corporation (The) and Allied World Assurance Company Holdings’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Allstate Corporation (The) $37.52 billion 0.88 $4.70 billion $6.77 13.42
Allied World Assurance Company Holdings N/A N/A N/A $2.90 16.98

Allstate Corporation (The) has higher revenue and earnings than Allied World Assurance Company Holdings. Allstate Corporation (The) is trading at a lower price-to-earnings ratio than Allied World Assurance Company Holdings, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

76.5% of Allstate Corporation (The) shares are held by institutional investors. Comparatively, 86.5% of Allied World Assurance Company Holdings shares are held by institutional investors. 1.6% of Allstate Corporation (The) shares are held by insiders. Comparatively, 3.2% of Allied World Assurance Company Holdings shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Allstate Corporation (The) pays an annual dividend of $1.48 per share and has a dividend yield of 1.6%. Allied World Assurance Company Holdings pays an annual dividend of $0.52 per share and has a dividend yield of 1.1%. Allstate Corporation (The) pays out 21.9% of its earnings in the form of a dividend. Allied World Assurance Company Holdings pays out 17.9% 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. Allstate Corporation (The) has increased its dividend for 3 consecutive years and Allied World Assurance Company Holdings has increased its dividend for 6 consecutive years.

Analyst Ratings

This is a summary of recent ratings and price targets for Allstate Corporation (The) and Allied World Assurance Company Holdings, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Allstate Corporation (The) 1 5 6 0 2.42
Allied World Assurance Company Holdings 0 6 0 0 2.00

Allstate Corporation (The) presently has a consensus target price of $89.91, suggesting a potential downside of 1.07%. Allied World Assurance Company Holdings has a consensus target price of $39.25, suggesting a potential downside of 20.29%. Given Allstate Corporation (The)’s stronger consensus rating and higher possible upside, analysts clearly believe Allstate Corporation (The) is more favorable than Allied World Assurance Company Holdings.

Summary

Allstate Corporation (The) beats Allied World Assurance Company Holdings on 8 of the 14 factors compared between the two stocks.

About Allstate Corporation (The)

The Allstate Corporation (Allstate) is a holding company for Allstate Insurance Company. The Company’s business is conducted principally through Allstate Insurance Company, Allstate Life Insurance Company and other subsidiaries. It is engaged in the property-liability insurance business and the life insurance, retirement and investment products business. Its segments include Allstate Protection, Allstate Financial, Discontinued Lines and Coverages, and Corporate and Other. The Allstate Protection segment sells private passenger auto, homeowners, and other property-liability insurance products through agencies and directly through contact centers and the Internet. The Allstate Financial segment sells life insurance and voluntary accident and health insurance products. The Corporate and Other segment consists of holding company activities and certain non-insurance operations. Its Discontinued Lines and Coverages segment includes results from property-liability insurance coverage.

About Allied World Assurance Company Holdings

Allied World Assurance Company Holdings Ltd is a Germany-based holding company. It provides property, casualty and specialty insurance and reinsurance solutions to clients around the world. The Company operates in three segments: North American Insurance, Global Markets Insurance and Reinsurance. The North American Insurance segment consists of the Company’s direct insurance operations in the United States, Bermuda and Canada. The Global Markets Insurance segment includes all of the Company’s direct insurance operations outside of North America. The Company’s reinsurance segment includes the reinsurance of property, general casualty, professional liability, specialty lines and property catastrophe coverage’s written by other reinsurance companies. The Company leases space in Australia, Bermuda, Canada, Hong Kong, Ireland, Labuan, Singapore, the United Kingdom and the United States for the operation of its North American Insurance, Global Markets Insurance and Reinsurance segments.

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