Assurant (NYSE:AIZ) versus Prudential Financial (NYSE:PRU) Critical Comparison

Assurant (NYSE:AIZ) and Prudential Financial (NYSE:PRU) are both large-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, profitability, risk and valuation.

Profitability

This table compares Assurant and Prudential Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Assurant	7.60%	20.32%	3.26%
Prudential Financial	5.83%	16.33%	0.68%

Analyst Ratings

This is a breakdown of current ratings and target prices for Assurant and Prudential Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Assurant	0	1	9	0	2.90
Prudential Financial	5	11	0	0	1.69

Assurant currently has a consensus price target of $283.57, indicating a potential upside of 3.32%. Prudential Financial has a consensus price target of $101.92, indicating a potential downside of 8.31%. Given Assurant’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Assurant is more favorable than Prudential Financial.

Insider & Institutional Ownership

92.7% of Assurant shares are held by institutional investors. Comparatively, 56.8% of Prudential Financial shares are held by institutional investors. 0.5% of Assurant shares are held by insiders. Comparatively, 0.1% of Prudential Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Risk & Volatility

Assurant has a beta of 0.55, meaning that its stock price is 45% less volatile than the S&P 500. Comparatively, Prudential Financial has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500.

Earnings and Valuation

This table compares Assurant and Prudential Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Assurant	$12.81 billion	1.06	$872.70 million	$19.55	14.04
Prudential Financial	$57.68 billion	0.67	$3.58 billion	$9.72	11.44

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

Dividends

Assurant pays an annual dividend of $3.52 per share and has a dividend yield of 1.3%. Prudential Financial pays an annual dividend of $5.60 per share and has a dividend yield of 5.0%. Assurant pays out 18.0% of its earnings in the form of a dividend. Prudential Financial pays out 57.6% 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. Assurant has increased its dividend for 21 consecutive years and Prudential Financial has increased its dividend for 2 consecutive years.

Summary

Assurant beats Prudential Financial on 13 of the 17 factors compared between the two stocks.

About Assurant

Assurant, Inc., together with its subsidiaries, provides business services that supports, protects, and connects consumer purchases in North America, Latin America, Europe, and the Asia Pacific. The company operates through two segments: Global Lifestyle and Global Housing. The Global Lifestyle segment offers mobile device solutions, and extended service contracts and related services for consumer electronics and appliances, and credit and other insurance products; and vehicle protection, commercial equipment, and other related services. The Global Housing segment provides lender-placed homeowners, manufactured housing, and flood insurance; renters insurance and related products; and voluntary manufactured housing, and condominium and homeowners insurance products. The company was formerly known as Fortis, Inc. and changed its name to Assurant, Inc. in February 2004. Assurant, Inc. was founded in 1892 and is headquartered in Atlanta, Georgia.

About Prudential Financial

Prudential Financial, Inc., together with its subsidiaries, provides insurance, investment management, and other financial products and services in the United States and internationally. It operates through PGIM, Retirement Strategies, Group Insurance, Individual Life, and International Businesses segments. The PGIM segment offers investment management services and solutions related to public fixed income, public equity, real estate debt and equity, private credit and other alternatives, and multi-asset class strategies to institutional and retail clients, as well as its general account. The Retirement Strategies segment provides a range of retirement investment, and income products and services to retirement plan sponsors in the public, private, and not-for-profit sectors; develops and distributes individual variable and fixed annuity products. The Group Insurance segment offers various group life, and long-term and short-term group disability, as well as group corporate-, bank-, and trust-owned life insurance in the United States primarily for institutional clients for use in connection with employee and membership benefits plans; sells accidental death and dismemberment, and other supplemental health solutions; and plan administration services in connection with its insurance coverages. The Individual Life segment develops and distributes variable life, universal life, and term life insurance products. The International Businesses segment develops and distributes life insurance, retirement products, investment products, and certain accident and health products; and advisory services. The company provides its products and services to individual and institutional customers through its proprietary and third-party distribution networks. Prudential Financial, Inc. was founded in 1875 and is headquartered in Newark, New Jersey.