Infinity Property and Casualty (NASDAQ: IPCC) and Atlas Financial (NASDAQ:AFH) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.

Profitability

This table compares Infinity Property and Casualty and Atlas Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Infinity Property and Casualty 3.37% 7.02% 2.03%
Atlas Financial 0.92% -2.57% -0.78%

Dividends

Infinity Property and Casualty pays an annual dividend of $2.32 per share and has a dividend yield of 2.2%. Atlas Financial does not pay a dividend. Infinity Property and Casualty pays out 49.2% of its earnings in the form of a dividend. Infinity Property and Casualty has increased its dividend for 9 consecutive years.

Volatility & Risk

Infinity Property and Casualty has a beta of 0.86, indicating that its share price is 14% less volatile than the S&P 500. Comparatively, Atlas Financial has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500.

Institutional and Insider Ownership

95.9% of Infinity Property and Casualty shares are held by institutional investors. Comparatively, 79.7% of Atlas Financial shares are held by institutional investors. 3.2% of Infinity Property and Casualty shares are held by insiders. Comparatively, 13.3% of Atlas Financial shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent recommendations for Infinity Property and Casualty and Atlas Financial, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Infinity Property and Casualty 0 1 1 0 2.50
Atlas Financial 0 0 3 0 3.00

Infinity Property and Casualty currently has a consensus target price of $99.50, indicating a potential downside of 6.35%. Atlas Financial has a consensus target price of $18.50, indicating a potential downside of 2.12%. Given Atlas Financial’s stronger consensus rating and higher possible upside, analysts plainly believe Atlas Financial is more favorable than Infinity Property and Casualty.

Earnings & Valuation

This table compares Infinity Property and Casualty and Atlas Financial’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Infinity Property and Casualty $1.54 billion 0.75 $43.08 million $4.72 22.51
Atlas Financial $177.58 million 1.28 $2.64 million $0.14 135.01

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

Summary

Infinity Property and Casualty beats Atlas Financial on 9 of the 16 factors compared between the two stocks.

About Infinity Property and Casualty

Infinity Property and Casualty Corporation is a holding company. The Company’s segments include Personal Auto, Commercial Vehicle and Classic Collector (its segments are Personal Auto and Commercial Vehicle). The Company writes personal automobile insurance with a concentration on nonstandard automobile insurance, commercial vehicle insurance and classic collector automobile insurance. The Company offers personal and commercial automobile insurance in states, including Arizona, California, Florida and Texas. Personal Automobile is its insurance product, which provides coverage to individuals for liability to others for bodily injury and property damage and for physical damage to an insured’s own vehicle from collision and various other perils. Commercial Vehicle provides coverage to businesses for liability to others for bodily injury and property damage and for physical damage to vehicles from collision. Classic Collector provides protection for classic collectible automobiles.

About Atlas Financial

Atlas Financial Holdings Inc formerly JJR VI Acquisition Corp is a Canada-based company. It is engaged in the business of providing commercial automobile insurance in the United States with a niche market orientation. The Company’s automobile insurance products provide coverage in three areas: liability, accident benefits and physical damage. Liability insurance provides coverage where the insured is responsible for an automobile accident, for the payment for injuries and property damage to third parties. Accident benefit policies or personal injury protection policies provide coverage for loss of income, medical and rehabilitation expenses for insured persons who are injured in an automobile accident, Physical damage coverages provide for the payment of damages to an insured automobile arising from a collision with another object or from other risks. In January 2013, the Company acquired Camelot Services Inc. and its insurance subsidiary, Gateway Insurance Company.

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