Critical Analysis: Tiptree Financial (NASDAQ:TIPT) vs. Huize (NASDAQ:HUIZ)

Tiptree Financial (NASDAQ:TIPT) and Huize (NASDAQ:HUIZ) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, earnings, analyst recommendations, institutional ownership, profitability, valuation and dividends.

Earnings & Valuation

This table compares Tiptree Financial and Huize”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tiptree Financial	$2.04 billion	0.44	$53.37 million	$1.26	18.97
Huize	$171.10 million	0.20	-$90,000.00	$0.03	114.67

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

Volatility and Risk

Tiptree Financial has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500. Comparatively, Huize has a beta of 0.41, suggesting that its stock price is 59% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Tiptree Financial and Huize, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tiptree Financial	0	0	0	0	0.00
Huize	0	1	0	0	2.00

Huize has a consensus target price of $2.30, suggesting a potential downside of 33.14%. Given Huize’s stronger consensus rating and higher probable upside, analysts plainly believe Huize is more favorable than Tiptree Financial.

Insider & Institutional Ownership

37.8% of Tiptree Financial shares are held by institutional investors. 32.7% of Tiptree Financial shares are held by insiders. Comparatively, 30.4% of Huize shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Tiptree Financial and Huize’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tiptree Financial	2.77%	13.90%	1.63%
Huize	1.40%	4.38%	2.04%

Summary

Tiptree Financial beats Huize on 9 of the 13 factors compared between the two stocks.

About Tiptree Financial

Tiptree Inc., through its subsidiaries, provides specialty insurance products and related services primarily in the United States. It operates through two segments: Insurance and Mortgage. The company offers niche; commercial lines insurance products, including professional liability, general liability, contractual liability protection, property and other short-tail, and alternative risks insurance products; and personal lines insurance products, such as credit protection surrounding loan payments. It also provides auto and consumer warranty programs, including mobile devices, consumer electronics, appliances, furniture; and vehicle service contracts, GAP, and ancillary products; as well as premium or warranty contract financing services, lead generation support, and business process outsourcing services. In addition, the company offers mortgage loans for institutional investors; asset management services; and maritime shipping and asset management services, as well as invests in shares. It markets its products through a network of independent insurance agents, consumer finance companies, online retailers, auto dealers, and regional big box retailers. The company was formerly known as Tiptree Financial Inc. and changed its name to Tiptree Inc. in December 2016. Tiptree Inc. was founded in 1978 and is headquartered in Greenwich, Connecticut.

About Huize

Huize Holding Limited, together with its subsidiaries, offers online insurance product and service platform through various internet channels in the People's Republic of China. The company provides life and health insurance products, such as critical illness, illness and disease, annuity, and term and whole life insurance products; and property and casualty insurance products, including travel, individual casualty, and corporate liability insurance products. It also offers offline insurance intermediary and brokerage services. The company also provides digital and technology development services; investment, technology development, internet information, management, and financial consulting services; business management and catering services; and insurance agency services. Huize Holding Limited was founded in 2006 and is headquartered in Shenzhen, China.