Contrasting Global Indemnity Group (NASDAQ:GBLI) & Travelers Companies (NYSE:TRV)

Travelers Companies (NYSE:TRV) and Global Indemnity Group (NASDAQ:GBLI) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, institutional ownership, valuation, risk and earnings.

Institutional and Insider Ownership

82.5% of Travelers Companies shares are owned by institutional investors. Comparatively, 37.4% of Global Indemnity Group shares are owned by institutional investors. 1.4% of Travelers Companies shares are owned by insiders. Comparatively, 47.1% of Global Indemnity Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Travelers Companies and Global Indemnity Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Travelers Companies	17.03%	26.19%	5.82%
Global Indemnity Group	6.74%	4.69%	1.94%

Dividends

Travelers Companies pays an annual dividend of $5.00 per share and has a dividend yield of 1.2%. Global Indemnity Group pays an annual dividend of $1.40 per share and has a dividend yield of 6.4%. Travelers Companies pays out 13.1% of its earnings in the form of a dividend. Global Indemnity Group pays out 66.7% 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. Travelers Companies has increased its dividend for 21 consecutive years and Global Indemnity Group has increased its dividend for 1 consecutive years.

Risk & Volatility

Travelers Companies has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500. Comparatively, Global Indemnity Group has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500.

Valuation & Earnings

This table compares Travelers Companies and Global Indemnity Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Travelers Companies	$48.83 billion	1.69	$6.29 billion	$38.14	10.55
Global Indemnity Group	$450.10 million	0.71	$25.33 million	$2.10	10.43

Travelers Companies has higher revenue and earnings than Global Indemnity Group. Global Indemnity Group is trading at a lower price-to-earnings ratio than Travelers Companies, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for Travelers Companies and Global Indemnity Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Travelers Companies	4	15	5	2	2.19
Global Indemnity Group	0	1	0	0	2.00

Travelers Companies currently has a consensus target price of $370.83, suggesting a potential downside of 7.86%. Given Travelers Companies’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Travelers Companies is more favorable than Global Indemnity Group.

Summary

Travelers Companies beats Global Indemnity Group on 15 of the 18 factors compared between the two stocks.

About Travelers Companies

The Travelers Companies, Inc. is a property and casualty insurance provider serving individuals, businesses and organizations. Its products include personal auto and homeowners insurance, as well as commercial coverage such as property, general liability, workers’ compensation and commercial auto insurance. The company also provides surety bonds and specialty insurance, including coverage for businesses and professional services. Travelers distributes many of its products through independent agents and brokers.

About Global Indemnity Group

Global Indemnity Group is a specialty property and casualty insurance and reinsurance company. Through its insurance operations, it offers coverage for niche commercial risks, including general liability, commercial property, professional liability and specialty programs. The company distributes products primarily through independent agents, brokers and wholesale partners. Its business includes Penn-America Group, which focuses on specialty commercial insurance, and reinsurance operations that take on risks from other insurers.