Reviewing Conifer (CNFR) and CNA Financial (CNA)

Conifer (NASDAQ: CNFR) and CNA Financial (NYSE:CNA) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, analyst recommendations, profitability, earnings and valuation.

Risk and Volatility

Conifer has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500. Comparatively, CNA Financial has a beta of 1.2, meaning that its share price is 20% more volatile than the S&P 500.

Insider and Institutional Ownership

26.0% of Conifer shares are held by institutional investors. Comparatively, 99.3% of CNA Financial shares are held by institutional investors. 52.5% of Conifer shares are held by company insiders. Comparatively, 0.2% of CNA Financial shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Conifer and CNA Financial’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Conifer $96.84 million 0.56 -$21.54 million ($2.90) -2.19
CNA Financial $9.54 billion 1.38 $899.00 million $3.38 14.33

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

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Conifer and CNA Financial, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Conifer 0 1 1 0 2.50
CNA Financial 0 1 0 0 2.00

Conifer currently has a consensus target price of $6.25, suggesting a potential downside of 1.42%. CNA Financial has a consensus target price of $55.00, suggesting a potential upside of 13.57%. Given CNA Financial’s higher possible upside, analysts plainly believe CNA Financial is more favorable than Conifer.

Profitability

This table compares Conifer and CNA Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Conifer -20.22% -34.51% -8.39%
CNA Financial 9.54% 8.06% 1.70%

Dividends

CNA Financial pays an annual dividend of $1.20 per share and has a dividend yield of 2.5%. Conifer does not pay a dividend. CNA Financial pays out 35.5% of its earnings in the form of a dividend.

Summary

CNA Financial beats Conifer on 12 of the 16 factors compared between the two stocks.

Conifer Company Profile

Conifer Holdings, Inc., an insurance holding company, offers insurance coverage in specialty commercial and specialty personal product lines. It underwrites various specialty insurance products, including property, general liability, commercial multi-peril, liquor liability, and automobile policies. The company serves the commercial insurance needs of owner-operated businesses in the markets, such as hospitality, which include restaurants, bars, taverns, and bowling centers, as well as small grocery and convenience stores; artisan contractors comprising plumbers, painters, carpenters, electricians, and other independent contractors; and security service providers, such as companies that provide security guard services, security alarm products and services, and private investigative services. It also offers specialty homeowners' insurance products, including dwelling insurance tailored for owners of lower valued homes in Illinois, Indiana, Louisiana, and Texas; and wind-exposed catastrophe coverage, such as hurricane and wind coverage to under-served homeowners in Hawaii, Texas, and Florida. The company markets and sells its insurance products through a network of approximately 6,300 independent agents, such as general agents in 50 states in the United States. Conifer Holdings, Inc. was founded in 2009 and is headquartered in Birmingham, Michigan with additional office facilities in Florida, Texas, Pennsylvania, and Tennessee.

CNA Financial Company Profile

CNA Financial Corporation provides commercial property and casualty insurance products primarily in the United States. It operates through Specialty, Commercial, International, Life & Group, and Corporate & Other segments. The company's property insurance products include property, marine, boiler, and machinery coverages; and casualty insurance products comprise workers compensation, general and product liability, commercial auto, and umbrella coverages. It also offers management and professional liability insurance and risk management services, and other specialized property and casualty coverages to various professional firms, including architects, real estate agents, and accounting and law firms; surety and fidelity bonds, and warranty and alternative risks products; directors and officers, employment practices, fiduciary and fidelity coverages to small and mid-size firms, public and private firms, and not-for-profit organizations; and professional and general liability, as well as associated standard property and casualty coverages for healthcare industry. In addition, the company offers long-tail exposures, including commercial automobile liability, workers' compensation, general and medical professional liability, other professional and management liability, and assumed reinsurance run-off and products liability; and short-tail exposures comprising property, commercial automobile physical damage, marine, surety, and warranty. CNA Financial Corporation markets its products through independent agents, brokers, and general underwriters to customers, including small, medium, and large businesses; insurance companies; associations; professionals; and other groups. It serves marine, property, financial services, healthcare, technology, oil and gas, construction, manufacturing, and life science industries. The company was founded in 1853 and is based in Chicago, Illinois.

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