Willis Towers Watson Public (NASDAQ:WTW) versus Assured Guaranty (NYSE:AGO) Head to Head Analysis

Assured Guaranty (NYSE:AGO) and Willis Towers Watson Public (NASDAQ:WTW) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their profitability, risk, institutional ownership, earnings, valuation, dividends and analyst recommendations.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Assured Guaranty and Willis Towers Watson Public, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Assured Guaranty	0	1	3	0	2.75
Willis Towers Watson Public	0	5	11	0	2.69

Assured Guaranty currently has a consensus price target of $91.00, indicating a potential upside of 29.60%. Willis Towers Watson Public has a consensus price target of $364.40, indicating a potential upside of 12.26%. Given Assured Guaranty’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Assured Guaranty is more favorable than Willis Towers Watson Public.

Institutional & Insider Ownership

92.2% of Assured Guaranty shares are owned by institutional investors. Comparatively, 93.1% of Willis Towers Watson Public shares are owned by institutional investors. 5.7% of Assured Guaranty shares are owned by insiders. Comparatively, 0.4% of Willis Towers Watson Public shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

Assured Guaranty pays an annual dividend of $1.52 per share and has a dividend yield of 2.2%. Willis Towers Watson Public pays an annual dividend of $3.84 per share and has a dividend yield of 1.2%. Assured Guaranty pays out 20.3% of its earnings in the form of a dividend. Willis Towers Watson Public pays out 23.6% 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. Assured Guaranty has increased its dividend for 7 consecutive years and Willis Towers Watson Public has increased its dividend for 8 consecutive years. Assured Guaranty is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Assured Guaranty has a beta of 0.73, suggesting that its share price is 27% less volatile than the S&P 500. Comparatively, Willis Towers Watson Public has a beta of 0.46, suggesting that its share price is 54% less volatile than the S&P 500.

Profitability

This table compares Assured Guaranty and Willis Towers Watson Public’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Assured Guaranty	37.34%	7.11%	3.25%
Willis Towers Watson Public	15.49%	22.19%	6.00%

Valuation and Earnings

This table compares Assured Guaranty and Willis Towers Watson Public”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Assured Guaranty	$1.11 billion	2.78	$503.00 million	$7.50	9.36
Willis Towers Watson Public	$9.71 billion	3.11	$1.60 billion	$16.26	19.96

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

Summary

Willis Towers Watson Public beats Assured Guaranty on 10 of the 17 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 Willis Towers Watson Public

Willis Towers Watson Public Limited Company operates as an advisory, broking, and solutions company worldwide. It operates through two segments: Health, Wealth & Career and Risk & Broking. The company offers strategy and design consulting, plan management service and support, broking and administration services for health, wellbeing, and other group benefit program, including medical, dental, disability, life, voluntary benefits and other coverages; actuarial support, plan design, and administrative services for pension and retirement savings plans; retirement consulting services and solutions; and integrated solutions that consists of investment discretionary management, pension administration, core actuarial, and communication and change management assistance services. It also provides advice, data, software, and products to address clients' total rewards and talent issues; and risk advice, insurance brokerage, and consulting services in the areas of property and casualty, affinity, risk and analytics, aerospace, construction, global markets direct & facultative, financial, executive and professional risks, financial solutions, crisis management, surety, marine, and natural resources. In addition, the company offers integrated solutions that consists of investment discretionary management, pension administration, core actuarial, and communication and change management assistance services; and software and technology, risk and capital management, products and product pricing, financial and regulatory reporting, financial and capital modeling, M&A, outsourcing, and business management services. The company was formerly known as Willis Group Holdings Public Limited Company and changed its name to Willis Towers Watson Public Limited Company in January 2016. Willis Towers Watson Public Limited Company was founded in 1828 and is based in London, the United Kingdom.