Contrasting Infinity Property and Casualty Corporation (NASDAQ:IPCC) & Progressive Corporation (The) (PGR)

Infinity Property and Casualty Corporation (NASDAQ: IPCC) and Progressive Corporation (The) (NYSE:PGR) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, risk, valuation, institutional ownership, profitabiliy, analyst recommendations and dividends.

Dividends

Infinity Property and Casualty Corporation pays an annual dividend of $2.32 per share and has a dividend yield of 2.4%. Progressive Corporation (The) pays an annual dividend of $0.68 per share and has a dividend yield of 1.5%. Infinity Property and Casualty Corporation pays out 55.9% of its earnings in the form of a dividend. Progressive Corporation (The) pays out 28.8% 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. Infinity Property and Casualty Corporation has raised its dividend for 9 consecutive years and Progressive Corporation (The) has raised its dividend for 3 consecutive years. Infinity Property and Casualty Corporation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

96.0% of Infinity Property and Casualty Corporation shares are held by institutional investors. Comparatively, 79.5% of Progressive Corporation (The) shares are held by institutional investors. 3.3% of Infinity Property and Casualty Corporation shares are held by company insiders. Comparatively, 0.6% of Progressive Corporation (The) shares are held by company 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.

Profitability

This table compares Infinity Property and Casualty Corporation and Progressive Corporation (The)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Infinity Property and Casualty Corporation 2.97% 6.21% 1.80%
Progressive Corporation (The) 5.50% 15.62% 3.78%

Analyst Recommendations

This is a summary of current ratings for Infinity Property and Casualty Corporation and Progressive Corporation (The), as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Infinity Property and Casualty Corporation 0 1 1 0 2.50
Progressive Corporation (The) 2 5 5 1 2.38

Infinity Property and Casualty Corporation currently has a consensus target price of $99.50, suggesting a potential upside of 1.17%. Progressive Corporation (The) has a consensus target price of $44.15, suggesting a potential downside of 4.76%. Given Infinity Property and Casualty Corporation’s stronger consensus rating and higher probable upside, research analysts clearly believe Infinity Property and Casualty Corporation is more favorable than Progressive Corporation (The).

Earnings and Valuation

This table compares Infinity Property and Casualty Corporation and Progressive Corporation (The)’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Infinity Property and Casualty Corporation $1.55 billion 0.70 $116.87 million $4.15 23.70
Progressive Corporation (The) $24.18 billion 1.11 $2.08 billion $2.36 19.64

Progressive Corporation (The) has higher revenue and earnings than Infinity Property and Casualty Corporation. Progressive Corporation (The) is trading at a lower price-to-earnings ratio than Infinity Property and Casualty Corporation, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Infinity Property and Casualty Corporation has a beta of 0.82, meaning that its stock price is 18% less volatile than the S&P 500. Comparatively, Progressive Corporation (The) has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500.

Summary

Progressive Corporation (The) beats Infinity Property and Casualty Corporation on 10 of the 18 factors compared between the two stocks.

About Infinity Property and Casualty Corporation

Infinity Property and Casualty Corporation is a holding company. The Company’s segments include Personal Auto, Commercial Vehicle and Classic Collector (its segments are Personal Auto and Commercial Vehicle). The Company writes personal automobile insurance with a concentration on nonstandard automobile insurance, commercial vehicle insurance and classic collector automobile insurance. The Company offers personal and commercial automobile insurance in states, including Arizona, California, Florida and Texas. Personal Automobile is its insurance product, which provides coverage to individuals for liability to others for bodily injury and property damage and for physical damage to an insured’s own vehicle from collision and various other perils. Commercial Vehicle provides coverage to businesses for liability to others for bodily injury and property damage and for physical damage to vehicles from collision. Classic Collector provides protection for classic collectible automobiles.

About Progressive Corporation (The)

The Progressive Corporation is an insurance holding company. The Company’s insurance subsidiaries and affiliates provide personal and commercial automobile and property insurance, other specialty property-casualty insurance and related services. The Company operates through the Personal Lines, Commercial Lines and Property segments. The Company’s Personal Lines segment writes insurance for personal autos, and recreational and other vehicles. The Commercial Lines business writes primary liability, physical damage and other auto-related insurance for automobiles and trucks owned and/or operated predominately by small businesses as a part of the commercial auto market. ASI is a homeowner carrier in the United States, which specializes in personal and commercial property insurance, personal umbrella insurance, and primary and excess flood insurance. The Company’s service business includes Commercial Auto Insurance Procedures/Plans (CAIP) and Commission-based businesses.




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