Head to Head Comparison: American Financial Group (NYSE:AFG) & Crawford & Company (NYSE:CRD.B)

Crawford & Company (NYSE:CRD.B) and American Financial Group (NYSE:AFG) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, analyst recommendations, earnings and profitability.

Analyst Ratings

This is a summary of recent ratings for Crawford & Company and American Financial Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Crawford & Company	0	0	0	1	4.00
American Financial Group	0	3	2	0	2.40

American Financial Group has a consensus target price of $156.00, suggesting a potential upside of 6.74%. Given American Financial Group’s higher possible upside, analysts plainly believe American Financial Group is more favorable than Crawford & Company.

Profitability

This table compares Crawford & Company and American Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Crawford & Company	1.81%	28.15%	6.51%
American Financial Group	11.51%	20.35%	2.94%

Risk and Volatility

Crawford & Company has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, American Financial Group has a beta of 0.62, suggesting that its stock price is 38% less volatile than the S&P 500.

Institutional and Insider Ownership

11.0% of Crawford & Company shares are owned by institutional investors. Comparatively, 64.4% of American Financial Group shares are owned by institutional investors. 51.0% of Crawford & Company shares are owned by company insiders. Comparatively, 16.9% of American Financial Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Crawford & Company and American Financial Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Crawford & Company	$1.31 billion	0.46	$19.63 million	$0.48	25.79
American Financial Group	$8.17 billion	1.48	$842.00 million	$11.44	12.78

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

Dividends

Crawford & Company pays an annual dividend of $0.30 per share and has a dividend yield of 2.4%. American Financial Group pays an annual dividend of $3.52 per share and has a dividend yield of 2.4%. Crawford & Company pays out 62.5% of its earnings in the form of a dividend. American Financial Group pays out 30.8% 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. American Financial Group has raised its dividend for 19 consecutive years.

Summary

American Financial Group beats Crawford & Company on 11 of the 18 factors compared between the two stocks.

About Crawford & Company

Crawford & Co. engages in the provision of claims management and outsourcing solutions to carriers, brokers, and corporates. It operates through the following segments: Crawford Loss Adjusting, Crawford TPA Solutions, and Crawford Platform Solutions. The Crawford Loss Adjusting segment consists of adjusting services provided to insurance companies and self-insured entities related to property and casualty losses caused by physical damage to commercial and residential real property and certain types of personal property. The Crawford TPA Solutions segment provides third party administration for workers’ compensation, auto and liability, disability absence management, medical management, and accident and health to corporations, brokers, and insurers worldwide. The Crawford Platform Solutions segment is involved in the management of contractor networks and the provision of claims management services to insurance companies and self-insured entities related to property, casualty, and catastrophic losses. The company was founded by Jim Crawford in 1941 and is headquartered in Peachtree Corners, GA.

About American Financial Group

American Financial Group, Inc., an insurance holding company, provides specialty property and casualty insurance products in the United States. The company offers property and transportation insurance products, such as physical damage and liability coverage for buses and trucks, inland and ocean marine, agricultural-related products, and other commercial property and specialty transportation coverages; specialty casualty insurance, including primarily excess and surplus, executive and professional liability, general liability, umbrella and excess liability, and specialty coverage in targeted markets, as well as customized programs for small to mid-sized businesses and workers’ compensation insurance; and specialty financial insurance products comprising risk management insurance programs for lending and leasing institutions, fidelity and surety products, and trade credit insurance. It sells its property and casualty insurance products through independent insurance agents and brokers. The company was founded in 1872 and is headquartered in Cincinnati, Ohio.