Critical Analysis: MBIA (NYSE:MBI) & AXA (OTCMKTS:AXAHY)

MBIA (NYSE:MBI) and AXA (OTCMKTS:AXAHY) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, dividends, profitability, earnings, analyst recommendations, institutional ownership and valuation.

Insider & Institutional Ownership

61.0% of MBIA shares are owned by institutional investors. Comparatively, 0.1% of AXA shares are owned by institutional investors. 12.6% of MBIA shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares MBIA and AXA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MBIA	-198.88%	N/A	-2.12%
AXA	N/A	N/A	N/A

Risk & Volatility

MBIA has a beta of 1.91, meaning that its share price is 91% more volatile than the S&P 500. Comparatively, AXA has a beta of 0.68, meaning that its share price is 32% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for MBIA and AXA, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MBIA	1	0	1	0	2.00
AXA	0	0	2	1	3.33

MBIA presently has a consensus target price of $8.50, suggesting a potential upside of 23.10%. Given MBIA’s higher probable upside, research analysts plainly believe MBIA is more favorable than AXA.

Valuation and Earnings

This table compares MBIA and AXA”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MBIA	$42.00 million	8.30	-$444.00 million	($3.64)	-1.90
AXA	$78.03 billion	1.30	$8.53 billion	N/A	N/A

AXA has higher revenue and earnings than MBIA.

Summary

AXA beats MBIA on 7 of the 12 factors compared between the two stocks.

About MBIA

MBIA Inc. provides financial guarantee insurance services to public finance markets in the United States. It operates United States (U.S.) Public Finance Insurance, and International and Structured Finance Insurance segments. The company issues financial guarantees for municipal bonds, including tax-exempt and taxable indebtedness of the U.S. political subdivisions, as well as utility districts, airports, health care institutions, higher educational facilities, housing authorities, and other similar agencies and obligations issued by private entities. It also insures the non-U.S. public finance and global structured finance, including asset-backed obligations; and sovereign-related and sub-sovereign bonds, and privately issued bonds used for the financing for utilities, toll roads, bridges, public transportation facilities, and other types of infrastructure projects, as well as offers third-party reinsurance services. MBIA Inc. was founded in 1973 and is headquartered in Purchase, New York.

About AXA

AXA SA, through its subsidiaries, provides insurance, asset management, and banking services worldwide. The company operates through six segments: France; Europe; AXA XL; Asia, Africa & EME-LATAM; AXA Investment Managers; and Transversal & Other segments It offers life and savings insurance products, such as savings and retirement, other health, and personal protection products. The company also provides property and casualty insurance products, including car, home, and personal or professional liability to individual and business clients; international insurance for large corporate clients in Europe; and marine and aviation insurance services, as well as property and casualty reinsurance products. In addition, it offers asset management services in the areas of various asset classes, including equities, bonds, hedge funds, private equity, and real estate for the group’s insurance companies and their clients, and retail and institutional clients. Further, the company provides motor, household, property and general liability, health, term life, whole life, universal life, endowment, deferred and immediate annuities, and other investment-based products for personal/individual and commercial/ group customers. AXA SA was founded in 1852 and is headquartered in Paris, France.