Financial Analysis: Waterdrop (WDH) vs. The Competition

Waterdrop (NYSE:WDH) is one of 311 publicly-traded companies in the “Insurance” industry, but how does it contrast to its rivals? We will compare Waterdrop to related businesses based on the strength of its earnings, profitability, valuation, risk, analyst recommendations, institutional ownership and dividends.

Valuation & Earnings

This table compares Waterdrop and its rivals revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Waterdrop	$568.81 million	$81.36 million	4.79
Waterdrop Competitors	$15.63 billion	$1.70 billion	35.24

Waterdrop’s rivals have higher revenue and earnings than Waterdrop. Waterdrop is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Analyst Ratings

This is a breakdown of current ratings for Waterdrop and its rivals, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Waterdrop	1	0	0	0	1.00
Waterdrop Competitors	3324	15644	16490	738	2.40

As a group, “Insurance” companies have a potential upside of 2.63%. Given Waterdrop’s rivals stronger consensus rating and higher possible upside, analysts clearly believe Waterdrop has less favorable growth aspects than its rivals.

Profitability

This table compares Waterdrop and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Waterdrop	10.69%	10.47%	7.40%
Waterdrop Competitors	9.09%	-9.90%	4.08%

Insider and Institutional Ownership

2.0% of Waterdrop shares are held by institutional investors. Comparatively, 55.9% of shares of all “Insurance” companies are held by institutional investors. 24.6% of Waterdrop shares are held by insiders. Comparatively, 13.6% of shares of all “Insurance” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Risk & Volatility

Waterdrop has a beta of -0.17, meaning that its stock price is 117% less volatile than the S&P 500. Comparatively, Waterdrop’s rivals have a beta of -1.59, meaning that their average stock price is 259% less volatile than the S&P 500.

Dividends

Waterdrop pays an annual dividend of $0.05 per share and has a dividend yield of 5.0%. Waterdrop pays out 23.8% of its earnings in the form of a dividend. As a group, “Insurance” companies pay a dividend yield of 2.8% and pay out 30.5% of their earnings in the form of a dividend. Waterdrop is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Summary

Waterdrop rivals beat Waterdrop on 8 of the 15 factors compared.

Waterdrop Company Profile

Waterdrop Inc., through its subsidiaries, provides online insurance brokerage services to match and connect users with related insurance products underwritten by insurance companies in the People's Republic of China. The company offers short-term health and long-term health and life insurance products and services. It also operates a medical crowdfunding platform. Waterdrop Inc. was founded in 2016 and is headquartered in Beijing, the People's Republic of China.