MetLife (NYSE:MET) & Assured Guaranty (NYSE:AGO) Head to Head Comparison

Assured Guaranty (NYSE:AGO) and MetLife (NYSE:MET) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, profitability and dividends.

Analyst Recommendations

This is a summary of current recommendations for Assured Guaranty and MetLife, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Assured Guaranty	0	2	2	0	2.50
MetLife	0	2	9	2	3.00

Assured Guaranty currently has a consensus price target of $101.00, indicating a potential upside of 14.23%. MetLife has a consensus price target of $95.27, indicating a potential upside of 20.53%. Given MetLife’s stronger consensus rating and higher possible upside, analysts plainly believe MetLife is more favorable than Assured Guaranty.

Dividends

Assured Guaranty pays an annual dividend of $1.36 per share and has a dividend yield of 1.5%. MetLife pays an annual dividend of $2.27 per share and has a dividend yield of 2.9%. Assured Guaranty pays out 16.9% of its earnings in the form of a dividend. MetLife pays out 48.3% 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. Assured Guaranty has increased its dividend for 7 consecutive years and MetLife has increased its dividend for 12 consecutive years. MetLife is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Assured Guaranty and MetLife’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Assured Guaranty	40.65%	7.09%	3.35%
MetLife	4.38%	21.81%	0.87%

Institutional and Insider Ownership

92.2% of Assured Guaranty shares are held by institutional investors. Comparatively, 95.0% of MetLife shares are held by institutional investors. 5.1% of Assured Guaranty shares are held by company insiders. Comparatively, 0.4% of MetLife shares are held 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.

Risk and Volatility

Assured Guaranty has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500. Comparatively, MetLife has a beta of 0.77, suggesting that its stock price is 23% less volatile than the S&P 500.

Valuation & Earnings

This table compares Assured Guaranty and MetLife”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Assured Guaranty	$872.00 million	4.68	$376.00 million	$8.06	10.97
MetLife	$77.08 billion	0.68	$3.38 billion	$4.70	16.82

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

Summary

MetLife beats Assured Guaranty on 11 of the 18 factors compared between the two stocks.

About Assured Guaranty

Assured Guaranty Ltd., together with its subsidiaries, provides credit protection products to public finance, infrastructure, and structured finance markets in the United States and internationally. It operates through two segments: Insurance and Asset Management. The company offers financial guaranty insurance that protects holders of debt instruments and other monetary obligations from defaults in scheduled payments. It insures and reinsures various debt obligations, including bonds issued by the United States state governmental authorities; and notes issued to finance infrastructure projects. In addition, the company insures and reinsures various the U.S. public finance obligations, such as general obligation, tax-backed, municipal utility, transportation, healthcare, higher education, infrastructure, housing revenue, investor-owned utility, renewable energy, and other public finance bonds. Further, the company involved in insuring and reinsuring of non-U.S. public finance obligations comprising regulated utilities, infrastructure finance, sovereign and sub-sovereign, renewable energy bonds, pooled infrastructure, and other public finance obligations; and the U.S. and non-U.S. Structured finance obligations, including residential mortgage-backed securities, life insurance transactions, consumer receivables securities, subscription finance facilities, pooled corporate obligations, and financial products. Additionally, it offers specialty business, such as real estate properties, insurance securitizations, and aircraft residual value insurance (RVI) transactions; and asset management services comprising investment advisory services. It markets its financial guaranty insurance directly to issuers and underwriters of public finance and structured finance securities, as well as to investors in such obligations. Assured Guaranty Ltd. was incorporated in 2003 and is headquartered in Hamilton, Bermuda.

About MetLife

MetLife, Inc., a financial services company, provides insurance, annuities, employee benefits, and asset management services worldwide. It operates through six segments: Retirement and Income Solutions; Group Benefits; Asia; Latin America; Europe, the Middle East and Africa; and MetLife Holdings. The company offers life, dental, group short-and long-term disability, individual disability, pet insurance, accidental death and dismemberment, vision, and accident and health coverages, as well as prepaid legal plans; administrative services-only arrangements to employers; and general and separate account, and synthetic guaranteed interest contracts, as well as private floating rate funding agreements. It also provides pension risk transfers, institutional income annuities, structured settlements, and capital markets investment products; and other products and services, such as life insurance products and funding agreements for funding postretirement benefits, as well as company, bank, or trust-owned life insurance used to finance nonqualified benefit programs for executives. In addition, it provides fixed, indexed-linked, and variable annuities; pension products; regular savings products; whole and term life, endowments, universal and variable life, and group life products; longevity reinsurance solutions; credit insurance products; and protection against long-term health care services. MetLife, Inc. was incorporated in 1999 and is based in New York, New York.